Homebuyer FAQs

Homebuyer FAQs


These questions and answers are intended to provide general information and are not the final word on program requirements. For more information: see the information for the program you are interested in, call a participating lender (88k PDF), call our toll free hotline 1-800-NJ-HOUSE (654-6873), or visit theroadhomenj.com to discover all of NJHMFA’s available mortgage programs.


  1. Am I a First-Time Homebuyer?

    A First-Time Homebuyer is someone who has not owned a home for the past three years. If the house you are buying is in one of the designated Urban Target Area neighborhoods you do not have to be a first-time buyer, however, you cannot own any other houses.

  2. Do I have to be a New Jersey resident to apply for a loan?

    No, but the property you are buying must be in New Jersey and you must occupy it as your principal residence.

  3. Do I have to be a citizen of the U.S. to apply?

    No, but you must be a permanent legal resident.

  4. Are there income and purchase price restrictions for the first-time and Urban Target Area homebuyers?

    Yes, the federal tax laws require that maximum household income and purchase prices be set for each county.

  5. Where do I apply for a loan?

    Loan applications are made through our participating private lenders, all of whom are listed on the Participating Lender List (88k PDF).

  6. Are there any penalties or other downside to having an Agency loan?

    Under the Homebuyer Program, there is a federal requirement that during the first nine years a portion of the gain on the sale of the home be recaptured by the U. S. Treasury if the property and borrower income have increased significantly. For more information, see the discussion of the Recapture Rules on this website.

  7. What are the requirements for the Police and Firemen's Retirement System Mortgage Program?

    Borrowers must be active members of the Police and Firemen's Retirement System (PFRS) with at least one year of creditable service. There are no income or purchase price limits, but there is a maximum mortgage loan amount. Learn more at the Police and Firemen's Retirement System Mortgage Program page here.

  8. Can I refinance my loans with your program?

    Due to federal tax code restrictions and current NJHMFA product availability, refinancing is not available under the First-Time Homebuyer or Homeward Bound Mortgage Programs. The Police and Firemen's Retirement System Mortgage Program may allow for refinance loans.  Please speak to your Participating Lender for more information.

  9. What if I have bad credit or no credit?

    Every borrower's credit history has to be individually considered. It is not a good idea to make assumptions about whether one's credit is good or bad. You can have a lender to evaluate your credit history and pre-qualify you for a loan or advise you about what you need to do to prepare to become "mortgage ready." Credit counseling agencies are an excellent resource if your credit needs to be repaired.

  10. How much can I borrow based on my salary?

    The amount varies based on the interest rate, length of the mortgage term, taxes and insurance costs, condo fees, and other factors. Use the online mortgage calculator to get an estimated amount.

  11. What is the New Jersey Housing and Mortgage Finance Agency?

    NJHMFA is a statutorily authorized entity of the State of New Jersey. The Agency is empowered to raise money by issuing tax-exempt bonds. Since the Agency's borrowing costs are low, it can pass the savings along in the form of low-interest rate mortgage loans to qualified homebuyers. The Agency also is empowered to finance multifamily rental housing and is the allocating agency for the federal Low Income Housing Tax Credit program.

  12. What is the Recapture Tax?

    Download the Recapture Tax Explanation (112kb PDF)