First-Time Buyers
What First-Time Homebuyers in New Jersey Should Know
A practical guide for first-time homebuyers in New Jersey: budgeting, loan options, state assistance programs, attorney review, inspections and avoiding common mistakes.
- By
- PG Realty Group
- Published
- Updated
- Reading time
- 7 minutes
Key takeaways
- First-time buyers in New Jersey should get preapproved, research property taxes for specific towns, and ask lenders about low-down-payment loans and state assistance programs.
- The New Jersey Housing and Mortgage Finance Agency (NJHMFA) offers first-time homebuyer mortgage and down payment assistance programs with eligibility requirements.
- Plan for closing costs on top of your down payment, and hire a real estate attorney before you make an offer.
Start with the full monthly picture
Your mortgage payment is only part of the cost. In New Jersey, property taxes can be a significant share of your monthly housing expense, and they vary widely by municipality. Ask your agent to pull the actual tax bill for any home you're serious about.
Explore your loan options
- Conventional loans may be available with lower down payments for qualified buyers.
- FHA loans are insured by the federal government and can help buyers with smaller down payments or limited credit history.
- VA loans are available to eligible veterans and service members.
- State programs. The New Jersey Housing and Mortgage Finance Agency offers first-time homebuyer mortgage and down payment assistance programs through participating lenders. Income and purchase-price limits apply.
Program terms change, so confirm current details with a participating lender. A HUD-approved housing counselor can also help you prepare. You can find one through the CFPB.
Budget for closing costs
Beyond the down payment, buyers typically pay lender fees, title insurance, attorney fees, recording fees, prepaid taxes and insurance, and inspection costs. Your lender's Loan Estimate itemizes them, so compare estimates side by side.
Understand New Jersey's process
- Your agent will give you the Consumer Information Statement, which explains how agents can represent you.
- Accepted offers go through a three-business-day attorney review before the contract is final.
- Inspections in New Jersey often include radon testing and, for older homes, an oil-tank sweep.
Common first-time buyer mistakes
- Shopping before getting preapproved.
- Draining savings for the down payment and leaving no cushion for repairs.
- Opening new credit cards or financing a car before closing.
- Skipping inspections to make an offer more attractive without understanding the risk.
- Underestimating the commute. Test it at rush hour.
Sources & further reading
This article is general information, not legal, tax or financial advice. Rules and programs change; consult a New Jersey real estate attorney, tax professional or lender about your situation.
