NJHMFA Offers Cash Advance for First-time Buyers
We’ve had many a buyer call us and ask how the $8000 tax credit can help them buy a home if they can’t get that money until they buy a home. A classic Catch-22. Well, NJ has come up with an answer for those first time home buyers who need the tax credit money to help them with their downpayment or closing costs.
The New Jersey Housing Mortgage Finance Agency (NJHMFA) is offering cash payments, in the form of a zero interest loan, of up to $5,000 for qualified first-time home buyers in order to help them defray their closing costs or to satisfy the downpayment requirements. This will then help new home buyers get into the housing market and buy their first home.
This zero interest loan, offered as part of NJHMFA’s “Prefund” program, would act like a cash advance against the $8,000 tax credit that is being offered to first time home buyers who purchase their home between April 8 and December 1 of this year. Basically, home buyers would be provided with the payment as a loan and would be required to repay the advance/loan when they receive their federal tax credit.
Who can get this zero interest loan/cash advance? The loan/cash advance is available to first time home buyers who:
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Arrange their financing through the NJHMFA. (You can obtain a list of participating lenders by calling their toll-free number at (800) NJ HOUSE)
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Are qualified for the tax credit offered as a part of the federal stimulus program
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Pledge to apply the proceeds of their tax credit to repay the cash
For more details about the NJHMFA’s First Time Home Buyers Tax Credit Loan Program (TCLP) you can visit the HMFA page (http://www.state.nj.us/dca/hmfa/consu/buyers/ownprg/tclp.html).
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