Learn how to refinance your mortgage if you live in the state of New Jersey
Refinancing in New Jersey is easier and is less costly than in many states.
The refinance process in New Jersey is relatively simple:
1. Select a mortgage lender.
2. Submit your application.
3. Lock in your interest rate. (View current mortgage rates in New Jersey)
4. Select an attorney to close your loan.
5. Get all required documentation to your lender
6. After you are approved, close your loan with the attorney.
Home prices in most of New Jersey have decreased substantially over the last three years as with the rest of the nation. While there may still be some downward pressure on prices in 2010, most areas are finally reaching low points and may even start to head up slightly over the next year. The only negative issue that some New Jersey home owners are facing is that Fannie Mae and Freddie Mac still classify all of New Jersey as a "declining market." This term means that appraisers have to do extra work to justify current market values and in some cases lenders will cut the maximum loan-to-value of that you can borrow by 5%.
Many borrowers in the northern counties of New Jersey will need jumbo refinance mortgage loans. While jumbo refinance mortgage loan sources have become much scarcer over the past two years, there is some good news from Fannie Mae, Freddie Mac and FHA for northern New Jersey residents. Each of these mortgage providers has created an expanded jumbo mortgage loan limit of between $708,000 and $729,000. Borrowers with loan amounts above the current conforming maximum loan limit of $417,000 and below these maximum loan amounts may be able to utilize these programs to get a low fixed rate up to 95% of the value of their home.
For borrowers in need of loans with loan amounts below $417,000, standard conforming 30 year fixed rate loans are available at extremely competitive rates from Fannie Mae, Freddie Mac and FHA. Most secondary market lenders offer slightly different rates in each state, and the good news for New Jersey borrowers is that nearly every lender offers slightly better pricing for New Jersey refinance loans than for other states.
An attorney is required to close all first mortgage loans in the state of New Jersey. The good news is that unlike in some states, you only need one attorney to represent both you and the lender (in the past in New Jersey - and still for some states - you would have to pay for one attorney for you and one for the lender).
Borrowers are required by New Jersey banking law to be advised that they are not required to you any particular attorney required by the lender. However, in many cases, borrowers will get a better deal if the lender has a volume discount price from the closing attorney.
Despite the fact that the attorney represents both the borrower and the lender, the attorney has a responsibility to properly execute the closing and is also responsible to complete the closing according to the Department of Housing and Urban Development's (HUD's) closing requirements. The attorney's function is to complete a title search, obtain title insurance and close your loan according to the lender's instructions. New Jersey does allow notaries to witness signatures for borrowers instead of the attorney having to be present.
Unlike some other states, New Jersey does not have any type of mortgage refinance tax or conveyance fee. This saves refinancing home owners in New Jersey thousands of dollars when they refinance as compared with other states with this tax/fee.
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