Effective today, June 5, 2018 the New Jersey HomeSeeker Program (“HomeSeeker”) and the Smart Start Program will be combined and will be known as the NJHMFA Down Payment Assistance Program (DPA). Below are the highlights of the consolidated program:
- DPA is available statewide. Properties are not required to be located in a “Smart Growth” area.
- DPA will provide $10,000 toward down payment and closing cost assistance.
- DPA has a maximum income limit of 140% of Area Median Income but may be subject to more restrictive first mortgage investor guidelines, based on family size and property location. See the Policy and Procedures for Participating Lenders (“Seller’s Guide”) for more detail.
- The DPA loan will be considered satisfied if the Borrower continuously resides in the premises as his/her principal residence for five (5) years from the date of the closing of the loan. In the event the Borrower conveys, refinances or ceases to occupy the premises during the five (5) year term, all loan funds will be due and payable. The incremental loan forgiveness schedule used for Smart Start is no longer applicable.
- Although the programs have been combined, it is still necessary to select either HomeSeeker or Smart Start when reserving the loan in ILRS. Select HomeSeeker if the property is located in the counties of Atlantic, Burlington, Camden, Essex, Gloucester, Mercer, Passaic and Union. Select Smart Start for all other counties.
- DPA must be used with an eligible NJHMFA first mortgage.
- There will be no increase to the interest rate of the associated first mortgage when utilizing DPA.
- There is currently funding for 1,000 DPA units.
The NJHMFA Participating Lenders Guide
will be updated shortly with full detail.