Loan program for first-time homebuyers ending soon

Must close on home by Nov. 30 deadline Trenton — With the Nov. 30 deadline looming for prospective first-time homebuyers to purchase a home and receive the benefit of the federal government’s $8,000 tax credit, the New Jersey Housing and Mortgage Finance Agency (HMFA), is reminding New Jersey residents that the agency is offering a loan to assist with closing costs, down payments and other expenses related to their home purchase. The HMFA’s “PreFund” program provides first-time homebuyers with interest free loans to be repaid upon receipt of their federal tax credit. According to the HMFA, an affiliate of the New Jersey Department of Community Affairs, more than 400 families have taken advantage of the dual programs so far this year. The PreFund program works in conjunction with the federal tax credit being issued to qualified persons under the economic stimulus plan. HMFA will give people participating in its First-time Homebuyer Mortgage Program the opportunity to get an advance on their credit in the form of a loan, which is essentially a zero percent interest bridge loan that must be paid back once homeowners receive their federal tax refund check. “The one-two punch of the federal tax credit and our Prefund program makes home ownership in New Jersey even more affordable and attractive,” said HMFA Executive Director Marge DellaVecchia. “There are many New Jersey families who could benefit from this limited time resource but they must act now.” Funds for down payment Eligible households may receive a loan of up to $5,000 in anticipation of receiving the first-time homebuyer federal tax credit. The funds must be used for down payment and/or closing costs in combination with an HMFA mortgage or loan. Homeowners have until June 30, 2010 to repay the loan. “Because we underwrite our own loans, homebuyers have less red tape to work through,” said DellaVecchia. “We are committed to doing all we can to review documents and complete closings on or before the Nov. 30 deadline to ensure that no family misses out on this unique opportunity to make homeownership a reality.” In addition to the Prefund loan program, HMFA offers a wide variety of assistance programs to aid first-time homebuyers and existing homeowners, such as Live Where You Work, Home Plus Program and the Mortgage Assistance Pilot (MAP) Program. Since its inception in 1967, the HMFA has been committed to making quality housing available at costs affordable to New Jersey residents. Aside from first-time homebuyers, the HMFA works with senior citizens in senior and assisted living facilities, the disabled in special needs communities, and the state’s most needy families in traditional affordable housing developments. For further information on the Prefund program or other assistance options, call 1-800-NJHOUSE or go to www.nj-hmfa.com.