| The new year often brings about quite a bit of change. | | | | their annual income. What does this mean to the buyer |
| One such change is the new down payment | | | | who is looking at homes in NJ for sale? It means that if |
| requirements for New Jersey FHA loans. that's | | | | they are planning to buy a home utilizing a FHA insured |
| right...FHA mortgage loans in NJ now require a down | | | | mortgage, be aware of the changes to the minimum |
| payment of 3.5%, up from the 3% held for over a | | | | down payment requirements. there is still a lot of |
| decade. They say that drastic times call for drastic | | | | literature out there that suggests that the down |
| measures, and this is definitely one such measure. | | | | payment is 3%, but people need to be aware that it is |
| Lending guides on NJ mortgages have tightened up a | | | | 3.5% now. |
| lot for Fannie Mae loans. We as mortgage reps in | | | | The good news is that FHA loans still don't require the |
| New Jersey, were hoping that the down payment | | | | borrower to have perfect credit! FHA NJ mortgage |
| requirements of the government loans (FHA | | | | loans had a reputation of also being a loan for the |
| programs) would never go up. However, that is not the | | | | borrower whose credit score was less than par. This |
| case. | | | | is still the case...sort of. While NJ FHA loans now |
| You may think this sounds like small change, but with | | | | require a greater down payment (3.5%), they also |
| larger New Jersey mortgage loan amounts, this adds | | | | have a little bit less of a chance at passing |
| up. Even though house values in this state have gone | | | | underwriting guidelines, if the borrowers credit score is |
| down drastically, the loan amounts are generally still | | | | below 600 (FICO). Thus, it is largely a judgment call |
| very high. FHA loans were always known as the type | | | | based on the mortgage underwriter. The leniency on |
| of loans that people with small down payments got, | | | | the credit requirements for these types of loans, are |
| who generally had good jobs and could show all of | | | | really the saving grace for FHA clients right now. |