orly chen – bergen county's premier
real estate agent
O: 201.567.9191 / C:
information is key to the success of any real estate
especially when purchasing a home in Bergen County,
Mortgages in Bergen County, New Jersey
Many different kinds of loans
are available for homebuyers in the mortgage market, with new
options constantly being introduced. While the details can seem
overwhelming, there are certain qualities that extend to all
mortgage loans. It pays to consult with an attorney or real estate
professional like Orly Chen for more advice.
Principles of All Mortgage Loans
In mortgages, the purchased home is used as security to back
up the loan. If the borrower defaults by not making payments
on time, the mortgage lender can demand the sale of the home.
The larger the loan is compared to the home’s value, the
more risk it presents to the lender. The loan becomes more expensive
to reflect that difference.
The interest earned by the lender always equals the periodic
interest rate multiplied by the outstanding principle balance
of the loan. The periodic interest rate is the annual interest
rate divided by the number of payments in the year, most often
one per month, or 12.
Each required payment generally is a bit higher than the interest
due, which ensures that some of the loan principal. The process,
called amortization, allows most mortgage loans to be retired
after all the monthly payments are made.
Features of All Mortgage Loans
Mortgage loans can be classified in one of the three following
• Fixed payment and fixed interest rate: fixed rate mortgages • Fixed rate but variable payment: graduated payment mortgages • Variable rate and variable payment: adjustable rate mortgages
Homebuyers seeking a mortgage should always shop around for
the best terms. If the terms seem almost too good to be true,
however, be careful to check the other features of the loan.
Consider the case of variable rate loans, which often have
lower interest rates to start, but buyers face the risk that
interest rates could rise substantially in the future.
When in doubt about your mortgage loan, ask Orly Chen. As a
trusted leader in North New Jersey real estate, she can put
your mind at ease, or refer you to a partner who can answer
your mortgage questions.
First Time Homebuyers
In a special effort to stimulate the housing market, the U.S.
Congress passed and then extended a first-time home buyer tax
credit for up to $8,000 for first-time homebuyers. The legislation
also provides a tax credit up to $6,500 for current homeowners
who purchase a new or existing home. To qualify, a home must
be purchased for use as a principal residence before May 1, 2010,
with closing to take place before July 1, 2010.
In New Jersey, residents may be eligible for a special first-time
homebuyer insurance rate available from the New Jersey Housing
and Mortgage Finance Agency. The below-market, 30-year fixed
interest rate is available to first-time homebuyers and urban
area buyers. Down payments of as little as 3.5% are required,
and debt-to-income ratios as high as 38% are permitted. Restrictions
apply according to home price and income level.
When in doubt
about your mortgage loan, ask Orly Chen. As a trusted leader
in North New Jersey real estate, she can put your mind at ease,
or refer you to a partner who can answer your mortgage questions.
About Orly Chen
Chen is a leading
Tenafly real estate agent
in Northern New Jersey
specializing in the Bergen
County area. Her
integrity make Orly
one of the most sought-
after agents in the
Northern New Jersey
real estate market