Conventional 1% Down New Jersey

Purchase:

• 620 credit score required
• Max LTV 97%
• Conforming loan limit
• Primary residence
• Lender down payment capped at the lesser of 2% or $4,000
• First time homebuyer counseling required

Property Type:

• Single Family
• Condo (LPA only)
• PUDs (LPA only)

Purchase:

• 30-Year Fixed primary purchases ONLY
• 25% MI coverage required
• All HomeReady and Home Possible guidelines must be met

What Is the Conventional 1% Down Payment?

The Conventional 1% Down Payment is a mortgage program designed to assist homebuyers by requiring only a minimal upfront payment of just 1% of the home’s purchase price. Unlike traditional mortgage options that demand a higher down payment, this program aims to reduce the financial burden on buyers during the initial phase of homeownership.

The program helps open the door to homeownership for more borrowers by providing down payment assistance to borrowers with income up to 80% of the Area Median Income. These loans follow HomeReady and Home Possible guidelines, so they can take advantage of LLPA caps. The caps make it easier for underserved areas and underserved borrowers to achieve homeownership.

How Does It Work?

Under the conventional 1% down payment program, eligible homebuyers work with participating lenders who offer the Conventional 1% Down Payment option. The lender contributes 2% towards the down payment or up to $4,000, while the homebuyer contributes the remaining 1%. This combined 3% down payment opens doors to homeownership without depleting the buyer’s savings.

Borrower Eligibility

• Only eligible for borrowers with incomes up to 80% of the Area Median Income
• Fannie Mae Area Median Income Lookup Tool
• Freddie Mac Home Possible Income & Property Eligibility Tool
• Homeownership education required when all borrowers are first-time homebuyers