New Jersey first-time home buyer programs: grants and loans

The main New Jersey first time home buyer program is run by the New Jersey Housing and Mortgage Finance Agency (NJHMFA), the state's housing finance agency, but you apply through a participating lender. The lender adds a down payment loan of $10,000 or $15,000 that you never repay if you live in the home for five years and don't refinance or sell. To find a lender, fill out NJHMFA's lender form or call 1-800-NJ-HOUSE.

What help does NJHMFA offer?

The mortgage, the loan you take to buy the home, is the first loan. The DPA is a second loan that sits behind it. You can use the DPA only once, and only for your own costs. It can't pay costs the seller usually pays, or cover the gap when the appraised value, what an appraiser says the home is worth, is less than the price.

How is the down payment loan forgiven?

NJHMFA forgives the DPA if you live in the home as your main home for five years in a row from closing, and you don't refinance or sell. Closing is the day you sign the final papers and the home becomes yours. Forgiven means you no longer owe it. To refinance means to replace your mortgage with a new one.

The DPA is $15,000 in Bergen, Essex, Hudson, Hunterdon, Mercer, Middlesex, Monmouth, Morris, Ocean, Passaic, Somerset and Union counties, and $10,000 in Atlantic, Burlington, Camden, Cape May, Cumberland, Gloucester, Salem, Sussex and Warren.

Say you buy in Essex County and get $15,000. If you live there for five years and keep the same mortgage, you owe nothing. NJHMFA's program chart says you must repay the DPA if you refinance in your first five years. Before you sign, ask your lender: "If I sell or move out before five years, how much of the down payment loan do I repay?"

What is the First Generation program?

The First Generation program adds $7,000 for the down payment and closing costs, so you get $22,000 in the $15,000 counties or $17,000 in the $10,000 counties. It is forgiven on the same five-year terms. You qualify if you are a first-time buyer and either:

• your parents or legal guardians own no home, anywhere; or
• you were ever in foster care in New Jersey.

Your spouse or partner and everyone in your household also can't have owned a home they lived in during the past three years.

Who qualifies?

You are a first-time buyer if no one buying has owned the home they lived in during the past three years. That rule is waived in an urban target area, a set of neighborhoods in cities such as Newark, Camden, Paterson, Elizabeth and Atlantic City, and for qualified veterans. Either way, you can't own another home you live in when you close. Type the address into NJHMFA's site evaluator to see whether a home is in a target area.

The other rules:

• The home. It must be in New Jersey, and you must move in within 60 days of closing. It can be a single-family home, a condo or a townhome. It can also be a manufactured home fixed to land you own, or a two- to four-family home where you live in one of the apartments.
• Residency. NJHMFA's FAQ says you don't have to live in New Jersey already.
• Credit. A credit score of at least 620, and debts that are a small enough share of your income to meet the loan's debt-to-income rule.
• Homebuyer class. NJHMFA's homebuying roadmap says first-time buyers who want the DPA need a homebuyer certificate from a housing counseling course. Find a free or low-cost course on NJHMFA's counseling agency list.

What are the income and price limits?

NJHMFA's current income and price limits took effect June 17, 2026. An income limit is the most your household can earn in a year and still get the loan. NJHMFA's limits are 100% of the area median income for one or two people and 115% for three or more. The area median income is the middle income in your area: half of households earn more, and half earn less.

In urban target areas, the limits are higher, from $161,520 to $185,760 for one or two people. The price limit for a one-family home outside urban target areas is:

• $566,355 in Cumberland, Mercer and Warren counties;
• $659,386 in Burlington, Camden, Gloucester and Salem;
• $764,069 in Atlantic and Cape May;
• $1,306,975 in Bergen, Essex, Hudson, Hunterdon, Middlesex, Monmouth, Morris, Ocean, Passaic, Somerset, Sussex and Union.

If the FHA or VA loan limit is lower, the lower one applies.

How do you apply, step by step?

1. Get paired with a lender. Fill out NJHMFA's participating lender form on its homebuyer programs page, or call 1-800-NJ-HOUSE.
2. Ask which mortgage and which help fit your county, income and credit, and whether you qualify for First Generation.
3. Take a homebuyer counseling course and keep the certificate.
4. Gather your papers. NJHMFA asks for three years of signed tax returns, 30 days of pay stubs, two years of W-2 forms (the yearly wage statements from your employer) and two months of bank statements.
5. Check the home's address with the site evaluator before you make an offer.

Never pay anyone who calls about a "government grant" to buy a home. The Federal Trade Commission says the government doesn't contact you out of the blue about grants or ask for a fee to get one.

What should you do next?

Some New Jersey towns also sell homes below market price to buyers under an income limit, through a lottery, a random drawing among the people who apply. One company that runs these sales, Community Grants, Planning & Housing (CGP&H), posts them on its ownership opportunities page, and our guide to the NJ Housing Resource Center explains how to find the rest.

See open homes for sale and other listings on our New Jersey page and in our open listings, and use our qualify check to see which ones fit your household's income. Our guide to FHA loan requirements explains FHA loans, one of the loan types behind NJHMFA's first-time mortgage.