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Closing costs are a big concern for New Jersey home buyers, because they represent an out-of-pocket expense that typically must be paid up front. There’s also a lot of confusion surrounding this topic. With that in mind, here are five things you should know about home buyer closing costs in New Jersey.

1. Typical closing costs and pre-paid expenses for NJ home buyers are 2% to 3% of the purchase price.

The finalized amount of closing costs a buyer pays in New Jersey can vary, due to a number of factors. Generally speaking, a more expensive home will result in higher costs. But that’s just one variable that can affect the amount you pay to close on your home.

As of 2017, home buyer closing costs in New Jersey tend to average somewhere between 2% to 3% of the purchase price. But they can fall outside of this range as well, in some cases.

New Jersey home buyers who buy a home for $400,000 with a 20% down payment pay approximatley $6,700 in closing costs (not including pre paid expenses). Prepaids are not a fee, but are costs associated with the home that are paid in advance when closing on a loan. These include Property Taxes, Homeowner’s Insurance, and Mortgage Interest that will accrue between the closing date and month-end. Property Taxes and Homeowner’s Insurance are collected to put into your Escrow Account so that you have enough reserves to pay these bills then they are due.But again, ...


Do you plan to buy a home in New Jersey in 2017 or 2018? If so, we’re willing to bet you have a lot of questions about the steps that occur along the way. And we’ve got you covered. Here is a step-by-step overview of the home buying process in New Jersey, updated for fall 2017.

Steps in the New Jersey Home Buying Process

To help you understand the buying process, we’ve broken it down into seven common steps. The process can vary slightly from one person to the next, due to the many variables that are involved. But it usually goes something like this:

  1. Establish your budget and research the market.
  2. Research and choose a type of home loan.
  3. Get pre-approved by a lender.
  4. Find an experienced New Jersey real estate agent.
  5. Begin the house hunting process.
  6. Make an offer and, if necessary, negotiate with the seller.
  7. Close the deal and get the keys to your new house.

Step 1: Determine your budget and research the market.

Before you start house hunting, do some basic budgeting math to determine how much you can afford to spend each month ...


For many home buyers in New Jersey, the down payment represents the single biggest obstacle to homeownership. But in some cases, it’s only a perceived obstacle. The truth is today’s down payment requirements for New Jersey mortgage loans are lower than most people realize. Here’s what you should know about it, as a home buyer.

A 20% Down Payment Isn’t Always Necessary

A 2016 survey conducted by the National Association of REALTORS® found that 66% of people thought they needed more than 20% for a down payment on a house. That’s a common misconception.

The truth is borrowers don’t necessarily need a down payment of 20% to buy a house. The average down payment among New Jersey home buyers is somewhere around 10%, and there are financing options available today that allow for an even smaller down payment. But a lot of people don’t realize this.

Home Loans With Lower Investment Requirements

Can’t come up with 20% when buying a home in New Jersey? You still have options. Here are some examples of financing strategies with a lower down payment requirement.

  • Conventional loans with 3%: Fannie Mae and Freddie Mac, the two government-sponsored enterprises ...

The latest mortgage rate forecasts for New Jersey and the nation suggest that borrowing costs could rise gradually over the coming months. Analysts from two key organizations have predicted that 30-year loan rates could rise above 4% by the start of 2018. (They were averaging 3.83% as of September 21, 2017.)

Housing and economic forecasts are an imperfect science. Mortgage rate forecasts for New Jersey are the equivalent of an educated guess. Still, they do offer some useful insight into how the market might change over the coming months. And if the latest predictions prove accurate, that change could be summed up with just two words: gradual rise.

Two Mortgage Rate Forecasts for New Jersey Borrowers

According to the latest forecasts, mortgage rates in New Jersey are expected to rise gradually through the end of 2017 and also throughout 2018.

On September 20, the economists at Freddie Mac publish their latest long-range forecast for the U.S. economy and the housing market. Among other things, this report includes an outlook for lending rates.

Freddie Mac’s analysts expect that the average rate for a 30-year fixed home will end up averaging 4.0% for 2017. Looking beyond that, they expect the benchmark 30-year loan to average 4.4% during 2018. This is just one of several forecasts that suggest New Jersey mortgage rates could climb over the months ahead.

Similarly, the Mortgage Bankers Association (MBA) updated its ...


FHA-insured mortgage loans are a popular financing option among home buyers in New Jersey. They’re especially popular with first-time buyers, though they are not limited to this group. Here’s a quick look at the basic FHA loan requirements for New Jersey borrowers, updated for 2017.

FHA Loan Requirements in New Jersey

The Federal Housing Administration’s mortgage insurance program is managed by the Department of Housing and Urban Development (HUD). So it is HUD that establishes all of the guidelines and requirements for FHA loans issued to New Jersey borrowers.

Many of these guidelines can be found in HUD Handbook 4000.1, also known as the Single-Family Housing Policy Handbook. But that resource contains nearly 1,000 pages, and you’re a busy person. So we’ve pulled out a few of the most importantrequirements for an FHA loan in New Jersey.

Related: A forecast for the NJ housing market

A Minimum Down Payment of 3.5%

New Jersey home buyers who use an FHA loan to purchase a house must make a down payment of at least 3.5%. Specifically, that’s 3.5% of the purchase price or the appraised value, whichever is less. HUD refers to this as the minimum required investment, or MRI.

The good news is you can obtain down-payment funds from a third party, such as a family member or employer. FHA allows for “gift funds” from a variety of sources, including family members, ...


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