Consumer Resources At Your Fingertips

Whether you are interested in buying, renting or selling, it is always a wise decision to consult a REALTOR^® to help with your transaction. View the various resources and information on:

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NJHMFA Decreases First-Time Home Buyer Interest Rates

The New Jersey Housing Mortgage Finance Agency (NJHMFA) offers below-market, fixed interest rates to first-time home buyers and urban area buyers. Effective May 5, 2009, the interest rates for a 30 year term first-time home buyer loan are as follows:

• 5.500% - First Mortgage with no Smart Start assistance
• 5.875% - First Mortgage with 2% Smart Start assistance
• 6.000% - First Mortgage with 3% Smart Start assistance
• 6.250% - First Mortgage with 4% Smart Start assistance
  
  *The 40 year team requires an additional add-on of .125%

The NJHMFA is also offering up to $5,000 for qualified first-time home buyers to help defray closing costs or satisfy down payment requirements and help new buyers to get into the housing market as part of their "Pre-fund" program. The loan functions like a cash advance against the $8,000 tax credit being offered to first-time buyers who purchase a home between April 8 and December 1 of this year.

For more information on the NJHMFA's first-time home buyer programs, visit the NJHMFA website or call 1-800-NJ-HOUSE.

NATIONAL ASSOCIATION OF REALTORS^® Offers Advice on Flood Insurance

Floods are the most common natural disaster in the U.S. and most homeowners insurance does not cover damage it causes. Flood risk and flood insurance are important topics that home buyers should be aware of. View the NAR checklist, "Protect Your New Home: What to Ask Your Insurance Agent," for tips on how to ensure that your new home is adquately protected.

NJ Housing Mortgage Finance Agency Offers Cash Advance for First-time Buyer Costs

The New Jersey Housing Mortgage Finance Agency (NJHMFA) is offering cash payments of up to $5,000 for qualified first-time home buyers to help defray closing costs or satisfy down payment requirements and help new buyers to get into the housing market.

The loan, offered as part of NJHMFA's "Prefund" program, would function like a cash advance against the $8,000 tax credit being offered to first-time buyers who purchase a home between April 8 and December 1 of this year. In its simplest terms, purchasers would be provided with the payment as a loan and would be required to repay the advance when they receive their federal tax credit.

The cash advance is available to first-time home buyers who:

• Arrange their financing through the NJHMFA. (Obtain a list of participating lenders by calling (800) NJ HOUSE)
• Are qualified for the tax credit offered as a part of the federal stimulus program
• Pledge to apply the proceeds of their tax credit to repay the cash

View the full details of the NJHMFA's First-Time Home Buyers Tax Credit Loan Program (TCLP).

Fannie Mae Issues Guidelines for Loan Limits in High Cost Areas

On March 30, 2009, Fannie Mae issued Announcement 09-08, implementing the 2009 conforming loan limits for high cost areas (known as high-balance loans), like New Jersey. Through the American Recovery and Reinvestment Act of 2009 (ARRA), loan limits on mortgages secured by Fannie Mae were increased. Loan limits from Fannie Mae are limited to $417,000 to $729,750, depending on the county where the home is located and the loan program. The guidelines instituted in the announcement apply to loans delivered to Fannie Mae starting May 1, 2009.

The Fannie Mae announcement specifies eligibility requirements for high-balance loans, including:

• Loan must be conventional, first-lien mortgages only.
• One to four unit properties are eligible.
• Loans must be fixed-rate or adjustable rate loans (no balloons).
• Loans must meet loan-to-value (LTV) and minimum credit score requirements. For one unit properties with a fixed rate mortgage, the maximum LTV is 90 percent. The minimum credit score is 700 for LTVs above 75 percent and 660 for LTVs at or below 75 percent. For one unit properties with an adjustable rate mortgage, the maximum LTV is 75 percent and the minimum credit score is 680. For second homes and investment properties, the maximum LTV is 65 percent and the minimum credit score is 740. Other rules apply to other categories.

See HUD's website for details on local loan limits.

IRS Provides Filing Guidance on First-Time Home Buyer Tax Credit

Home buyers wanting to utilize the newly improved home buyer tax credit have to wait until they complete the purchase and close or, in the case of new construction, take up residence to claim the credit, the Internal Revenue Service (IRS) says in a newly released filing guidance. For households that did not close before the April 15 tax-filing deadline, the guidance provides options: 1) seek an extension, 2) file an amendment to your already submitted 2008 tax return, or 3) claim the credit in 2009 rather than 2008. Read the IRS guidance.

NJAR^® Encourages Consumers to Explore Short Sales as an Alternative to Foreclosure

There are key advantages to pursuing a short sale over a foreclosure. In today's unsteady economy, many homeowners experiencing financial difficulty have turned to a short sale as a means of avoiding a foreclosure. In many cases, sellers who cannot keep up with their mortgage payments strike a deal with their lender to sell the home and payoff less than the total amount due on the loan. In some cases, the lender forgives the outstanding debt.

Check out NJAR®'s new Short Sale and Foreclosure Resources webpage to find out more and to learn about government programs aimed to assist consumers facing these difficult situations.