Buying your first home in New Jersey, one step at a time

NJHMFA programs for first-time buyers

The New Jersey Housing and Mortgage Finance Agency (NJHMFA) runs several homebuyer programs. The NJHMFA First-Time Homebuyer Mortgage Program is a 30-year fixed-rate government-insured loan (FHA, VA or USDA). The HFA Advantage Mortgage Program is a 30-year fixed-rate conventional loan. The Homeward Bound Program is another 30-year fixed-rate government-insured option. Each can be paired with the NJHMFA Down Payment Assistance Program (DPA).

The DPA is a forgivable second loan with no interest and no monthly payments. It is forgiven if you live in the home as your principal residence for five years and don't refinance or otherwise convey the first mortgage. The NJHMFA First Generation Down Payment Assistance Program adds more help for first-time buyers whose parents or guardians don't own residential property, or who were ever placed in foster care in New Jersey.

You apply through an NJHMFA participating lender, not through the agency directly. Income and purchase price limits are set by county and change over time, so check NJHMFA's current fact sheets or ask a participating lender. NJHMFA also has a Site Evaluator to see whether a property is in an Urban Target Area, where different rules apply.

Who counts as a first-time buyer, and homebuyer education

For NJHMFA programs, you are generally a first-time homebuyer if you have not owned a home as your primary residence in the previous three years. The New Jersey Department of Banking and Insurance uses the same three-year idea in its home buying guide.

NJHMFA suggests considering homebuyer counseling for an in-depth look at the process. HUD-approved housing counseling agencies can help you review your finances and the homebuying process, and the CFPB has a tool to find one near you. Some loan programs require a homebuyer education course, so ask your lender early whether yours does.

Contracts, attorney review and your loan disclosures

In New Jersey, a sales contract prepared by a real estate licensee must include an attorney review clause. Buyer and seller each have three business days from delivery of the fully signed contract to consult an attorney, who may propose changes or cancel the contract. This comes from the New Jersey Supreme Court's 1983 State Bar Ass'n decision. Weekends and legal holidays are not counted.

Your lender has two federal deadlines. You should get a Loan Estimate within three business days of applying, and a Closing Disclosure at least three business days before closing. Compare the two line by line and ask about any change. I want you to understand what you're agreeing to.

On closing costs: New Jersey's Realty Transfer Fee is charged to the seller when the deed is recorded, so it is usually not a buyer cost.

The written agreement with your agent

Since August 1, 2024, New Jersey law (P.L. 2024, c.32) requires brokerage firms to have a written brokerage services agreement with buyers in residential transactions. It must be signed before, or as soon as reasonably practical after, the firm starts working for you.

The agreement must state the business relationship (for example, buyer's agent), whether it is exclusive, its term, and how the firm will be paid. It must say commission is fully negotiable and not set by law, and how things work if a seller offers no or limited compensation. You'll also receive the Consumer Information Statement, which explains the types of agency relationships in New Jersey.

How Cathy works with first-time buyers

Cathy Walters has been a licensed New Jersey real estate professional since 2007 and earned a First-Time Home Buyers certification in 2019. She has called South Jersey home since 1984 and works across Burlington, Camden, Gloucester, Salem, Cumberland and Mercer counties.

She focuses on buyer representation and education: what each document means, what happens next, and which questions to ask. Her design eye helps you see a property's potential beyond how it looks today. When you need other experts, she can connect you with real estate attorneys, inspectors, appraisers, surveyors, insurance agents and mortgage professionals from her network. If you'd like a referral, Cathy often works with Bradley Brondt, Branch Manager (NMLS 242550), The Brondt Cook Group at Acre Mortgage and Financial, Inc., in Cherry Hill. You're free to choose your own lender.

First-time buyer checklist for New Jersey

• Talk with a lender about pre-approval and ask whether they are an NJHMFA participating lender.
• Ask if your loan requires a homebuyer education course, and consider HUD-approved counseling.
• Review and sign a brokerage services agreement so you know how your agent works and is paid.
• Check a property's USDA eligibility or NJHMFA Urban Target Area status if those programs apply.
• Line up a real estate attorney before you sign, so attorney review starts on time.
• Schedule inspections quickly once the contract is binding; deadlines are set in the contract.
• Compare your Closing Disclosure with your Loan Estimate before closing day.