Buying your first home is a new and exciting time, but with such a big purchase comes a lot of unknowns. A home is likely the most expensive purchase you will ever make, so it is important to know what your options are before you begin.
National Mortgage Loans
There are many different national loans that you can pick from, but four of the most common for first time home buyers are Conventional, FHA, USDA, and VA loans.
National mortgage loans are a good option for first time home buyers because they are available to everyone. They are more common than loans for every individual state because they are offered nation-wide.
New Jersey Mortgage Loans
The state of New Jersey has its own lending programs that are separate from the national loans.
The New Jersey Housing and Mortgage Finance Agency (NJHMFA) offers these loans exclusively to first time home buyers, to help them get their first home.
NJHMFA Down Payment Assistance Program
- This program is made for buyers who may need help putting the down payment down on a home that they are financing with a NJHMFA loan.
- The assistance program allows for up to a $10,000 no-interest loan. To be eligible for this loan borrowers have to have a credit score of 620 or higher.
- The loan is also forgivable after five years, which makes it another great option for first time buyers.
Police and Firefighters Retirement System Mortgage Program
- The Retirement System Mortgage Program is only for current and active members of the police force and firefighters in New Jersey.
- In addition, both police and firefighters need to have been active for at least one year by the time of application.
What Should I Know Before I Buy a Home?
Know What You Can Afford
After talking about different loan options, you can then begin to look at what homes you can afford.
- It is a good idea to know the market that you are looking at so that you can make sure to not look at homes you can’t realistically afford.
- Take into account other expenses that come with the homes you are looking at, such as closing costs, insurance and property taxes.
Choose the Best Location
When trying to look at homes, it is important to have specific areas that you are looking in.
- Find an area with school districts that you like.
- There are many resources that can tell you what neighborhoods are safe to live in; areas that have higher crime, lower income vs. higher income areas.
- Look at the distance from the homes to your work, so you can figure out how long your commute will be.
- If public transportation is important for you to get around, make sure that you are looking at that as well.
Get a Home Inspection
When you find a home that you think could be the perfect fit, it is important to have a home inspection before you finalize anything.
- Many times, homes that seem perfect from the outside can have hidden problems.
- These could end up costing you a lot in repairs, and if you are using one of the loan options above, it may mean getting a higher loan.
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