How to Buy a Home in Hunterdon County: Mortgage and Loan Options in New Jersey

Hunterdon County has been consistently ranked one of the best places to live in New Jersey. The area boasts over 20 parks, multiple family campsites, creeks, ponds, rivers, 350 acres of preserved farms, excellent schools, safe neighborhoods, and stunning homes. But if you are considering moving here, you also have to contend with the soaring mortgage rates currently plaguing the New Jersey market (6.95%). Here is a look at how to buy a home in Hunterdon County in 2024, specifically how to get a mortgage.

Cost of Buying a Home in New Jersey

Before you start looking for a lender, you need to determine the type of home you can afford in Hunterdon County. The current typical value of Hunterdon County Homes for Sale is $497,292, but there are many options below and above that price point. Going by this figure, however, you need to consider not just the listing price but the closing costs as well. The typical closing price of homes in New Jersey is 3 to 5 percent of the listing price. This comes to between $14,919 and $24,865 for a typical home.

You also need to consider the down payment, which is the key amount you must pay at closing before your lender can cover the balance. The typical down payment that lenders allow in New Jersey is 20 percent of the listing prices; this is another $99,458 to $497,292 for a typical home.

Consider Other Loans

Although 20 percent is the typical down payment in New Jersey, you may be able to pay less than that if you consider other loans. Government-backed loans, for instance, may allow you to pay between 0 (VA) and 3.5 (FHA) percent of the purchase price. VA loans are reserved for veterans, and FHA loans have requirements you may need to meet. Some conventional loans can also lower your down payment amount to 3 to 5 percent, with each lender offering varying rates.

Down Payment Assistance Programs

In some instances, you may qualify for down payment assistance programs that could also lower your down payment. New Jersey down payment assistance (DPA) programs are typically available to low-income and first-time homebuyers. There are several programs, each with different loan amounts and qualification requirements. The New Jersey Housing and Mortgage Finance Agency (NJHMFA) offers a second mortgage of up to $10,000 to first-time homebuyers and buyers who have not owned a home in the last three years. This loan is usually interest-free.

Mortgage Insurance

The two downsides of paying a lower down payment are that, first, you may end up paying a higher interest or monthly payment over the life of the loan. Two, you may need to purchase mortgage insurance. Different loans require different coverages, but the typical mortgage insurance costs 1 percent of your mortgage balance in annual payments. Your agent can help you understand your options.

Search Homes in Hunterdon County with Freeman Smith

Whether you are just starting to consider a move to New Jersey or actively exploring the Hunterdon County housing market, it is never too early to enlist the help of a real estate expert. A professional like Freeman Smith can help you navigate the local market, review your financing options, and close on the ideal home. Contact Smith today to discuss your real estate needs.