• Atlantic City 

• Orange

• Bayonne 

• Jersey City

• Paterson

• Carteret

• Keyport

• Plainfield

• Cherry Hill 

• Morristown

• Rahway

• Neptune

• Trenton

• Elizabeth

• Newark

• New Brunswick

Employment Information

• Most recent two years complete tax returns with all schedules.
• Most recent two years W-2's, 1099's, etc.
• Most recent pay stubs covering one month period.
• If Applicable: Self-Employed will need Three years Tax Returns and YTD Profit & Loss Statement.

Savings Information

• Most recent three months complete bank statements for any and all accounts with all pages.
• Most recent statement from retirement, 401k, mutual funds, money market, stocks, etc.

Credit Information

• Most recent statements from your bills, indicating minimum payments and account numbers.
• Name, Address, and Phone number of your landlord, or 12 months cancelled rent checks.
• If Applicable: Should you have no credit. Copies or your most recent utility bills will be needed.
• If Applicable: Copy of complete Bankruptcy and Discharge Papers.
• If Applicable: If you co-signed for a mortgage, car, credit card, etc, need 12 months cancelled checks. front and rear, indicating you are not making payments.

Personal Information

• Copy of Drivers License.
• Copy of Social Security Card.
• If Applicable: Copy of  complete Divorce, Palimony, Alimony Papers.
• If Applicable: Copy of Green Card or Work Permit.
• If Applicable: If you own another home(s) - see below

If a Refinance or you own Rental Property

• Copy of Note & Deed from current loan.
• Copy of Property Tax Bill.
• Copy of Hazard (homeowners) Insurance Policy.
• Copy of Payment Coupon for current Mortgage.
• If Applicable: If property is multi-unit, need Rental Agreements.

Additional documents may be needed upon review of your file and on a case-by-case scenario.

One of the first questions we will ask will consider is how much of your total income you will spend on housing. This information helps the lender decide whether you can comfortably afford a home.

When you are qualifying for a loan, a we will use your gross income. That means all the money you earn before taxes, including overtime, commissions, dividends and any other sources --as long as you can show a steady two year history for these sources.

Your monthly housing expense as a percentage of your monthly income is called the housing expense (a.k.a.: front-end) ratio. FHA suggests to spend about 29% of your income on your house payment (including the mortgage, property taxes, mortgage insurance and hazard insurance).

Calculate what your new monthly mortgage payment should be by using the formula:

Gross Monthly Income multiplied by 29% = Mortgage Payment.

Sometimes you have to stretch that percentage when you buy a house -- and that's one of the benefits of easier qualifying FHA home loans. To qualify, you're allowed to spend up to 35% of your income on your house payment, as long as everything else in your application shows that you can handle the "stretch."

One important thing FHA will do is compare your housing expense now to the expense you'll have if you buy a home. The smaller the increase, the stronger your application looks.

To easily understand the closing costs description below, you may want to download a sample "Good Faith Estimate" to view the form in it's entirety by clicking >> Here.

The form is broken into six separate sections. Each section is located below. The item number on the right side is from all legal HUD / Respa compliant forms. Please click on "Explanation of Fee" to learn more about the fee.

Loan Fee's

Below is a sample of a section of each section of a Good Faith Estimate that covers the loan fee's and charges of the lender. These fee's in this section are charged by the lender.

Following is a description of the normal non-reoccurring closing costs for a FHA loan. These fee's are typically paid by the buyer or owner. It may be negotiated that all or part of these fee's may be paid by the home seller or lender.

801. Loan Origination: This fee is usually known as a loan origination fee but sometimes is called a "point" or "points." It covers the lender's administrative costs in processing the loan. FHA regulates this fee to a maximum of 1% of the loan amount. Often this is expressed as a percentage of the loan. Generally, the buyer pays the fee, unless otherwise negotiated.

802. Loan Discount: Also often called "points" or "discount points," a loan discount is a one-time charge imposed by the lender or broker to either lower the rate at which the lender or broker would otherwise offer the loan to you or may be used to lock-in the interest rate for an extended period.  This fee may vary.

803. Appraisal Fee: This charge pays for an appraisal report made by an independent FHA appraiser. Typically range from $300 - $500.

804. Credit Report Fee: This fee covers the cost of a credit report, which shows your credit history. The lender uses the information in a credit report to help decide whether or not to approve your loan and how much money to lend you. Typically $40 - $55.

805. Lender's Inspection Fee: This charge covers inspections, often of newly constructed housing, made by employees of your lender or by an outside inspector. (Pest or other inspections made by companies other than the lender are discussed in line 1302.)

806. Mortgage Insurance Application Fee: This fee covers the processing of an application for mortgage insurance.

807. Assumption Fee: This is a fee which is charged when a buyer "assumes" or takes over the duty to pay the seller's existing mortgage loan.

808. - 809. Mortgage Broker Fee: Fees paid to mortgage brokers would be listed here. A CLO fee would also be listed here.

810. Loan Processing Fee:This fee is for the administrative cost of processing your loan files required paperwork.

811. Underwriting Fee: Fee charged by investor for underwriting the submitted loan file and all of its paperwork.

812. Wire Fee: Fee charged by investor for wiring out the required funds to close the loan.

813. Flood Certification: Every FHA loan request a flood report to insure that it is not located in a flood zone. If property is in flood zone, owner required to obtain flood insurance.

Prepaid Items

The following fee's are reoccurring pre-paid fee's. You may be required to prepay certain items at the time of settlement / closing. Some of these items would be accrued interest, mortgage insurance premiums, and homeowners / hazard insurance.

901. Interest: Lenders require borrowers to pay the interest that accrues from the date of settlement / closing to the first monthly payment which is prorated daily based on the new loans interest rate.

902. Mortgage Insurance Premium: FHA Mortgage Insurance Premium fee is 1.5% of the loan amount. This fee may be financed into the loan amount. If you pay the FHA loan off within the first seven years, you may be entitled to a prorated refund of the MIP.

903. Hazard Insurance Premium: Hazard insurance protects you and the lender against loss due to fire, windstorm, and natural hazards. Lenders often require the borrower to bring to the settlement a paid-up first year's policy or to pay for the first year's premium at settlement.

904. Flood Insurance: If the lender requires flood insurance, it is usually listed here.

Escrow Impound Account Reserves

All FHA loans require the establishing of an escrow impound account. This account allows your property taxes and homeowners / hazard insurance to be included in your monthly payment and paid annually as needed.

1001. Hazard Insurance: Usually 2 months prorations of your annual homeowners / hazard insurance policy.

1002. Mortgage Insurance: Usually 2 months of the monthly FHA mortgage insurance premium. This monthly fee is calculated as .5% of the final FHA loan amount divided by 12 for the monthly prorations.

1003. City Property Taxes: Some cities have assessed property taxes which would be collected here. This will vary from city to city.

1004. County Property Taxes: The amount of property taxes collected will vary and would be prorated based on the number of payments made on the new loan to until your property taxes are due. May be from zero to eleven months in advance.

1005-1007. Other Prorations: These would be any other fee's such as HOA dues.

1008. Aggregate Adjustment: The lender is not allowed to collect more than a certain amount. The individual item deposits may overstate the amount that can be collected. The aggregate adjustment makes the correction in the amount on line 1008. It will be zero or a negative amount.

Title & Other Fee's

This fee's are all other fee's associated with obtaining a FHA loan. Although these are not lender fee's, lenders must provide a quote of the estimated fee. These quotes may vary significantly. Title charges may cover a variety of services performed by title companies and others. Your particular settlement may not include all of the items below or may include others not listed.

1101. Settlement or Closing Fee: This fee is paid to the settlement agent or escrow holder. Responsibility for payment of this fee should be negotiated between the seller and the buyer.

1102-1104. Abstract of Title Search, Title Examination, Title Insurance Binder: The charges on these lines cover the costs of the title search and examination.

1105. Document Preparation: This is a separate fee that some lenders or title companies charge to cover their costs of preparation of final legal papers, such as a mortgage, deed of trust, note or deed.

1106. Notary Fee: This fee is charged for the cost of having a person who is licensed as a notary public swear to the fact that the persons named in the documents did, in fact, sign them. Usually $40 - $120.

1107. Attorney's Fees: You may be required to pay for legal services provided to the lender, such as an examination of the title binder. Occasionally, the seller will agree in the agreement of sale to pay part of this fee. The cost of your attorney and/or the seller's attorney may also appear here. If an attorney's involvement is required by the lender, the fee will appear on this part of the form, or on lines 1111, 1112 or 1113.

1108. Title Insurance: The total cost of owner's and lender's title insurance is shown here.

1109. Lender's Title Insurance: The cost of the lender's policy is shown here.

1110. Owner's (Buyer's) Title Insurance: The cost of the owner's policy is shown here.

Recording and Transfer Fee's

These fees are city, county and state fee's. They may be paid by you or by the seller, depending upon your agreement of sale with the seller. The buyer usually pays the fees for legally recording the new deed and mortgage (line 1201). Transfer taxes, which in some localities are collected whenever property changes hands or a mortgage loan is made, can be quite large and are set by state and/or local governments. City, county and/or state tax stamps may have to be purchased as well (lines 1202 and 1203).

Additional Settlement Charges:

These may be other third party fee's for services rendered in order to satisfy all loan, buyer, and seller requirements. All FHA loans require a termite report and clearance. Again, these fee's are negotiable between buyer and seller.

1301. Survey: The lender may require that a surveyor conduct a property survey. This is a protection to the buyer as well. Usually the buyer pays the surveyor's fee, but sometimes this may be paid by the seller.

1302. Pest and Other Inspections: This fee is to cover inspections for termites or other pest infestation of your home.

1303-1305. Lead-Based Paint Inspections: This fee is to cover inspections or evaluations for lead-based paint hazard risk assessments and may be on any blank line in the 1300 series.

If your transaction is a purchase, the total of all of these fee's would then be added to the amount of your down payment, which would total the amount needed to close your transaction.

For a refinance, these fee's could be added to your new loan amount, paid out of pocket, or financed into the interest rate with a lender credit.

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