New Jersey offers several down payment assistance programs that can help first-time buyers cover their upfront costs, including NJHMFA grants of up to $15,000, FHA loans with 3.5% down, VA and USDA zero-down options, and local assistance programs in Burlington County and across South Jersey. If you are a first-time buyer, you likely qualify for more help than you think.
The single biggest barrier to homeownership for first-time buyers is saving enough for the down payment and closing costs. According to the National Association of Realtors, 38% of first-time buyers say saving for a down payment is the most difficult step in the home buying process. But many buyers do not realize that New Jersey has some of the best down payment assistance programs in the country.
I have helped dozens of first-time buyers in Burlington County and South Jersey take advantage of these programs. This guide walks you through every option, from state-level grants to federal loan programs, so you can find the assistance that fits your situation.
Does New Jersey Offer Down Payment Assistance for First-Time Buyers?
Yes. The New Jersey Housing and Mortgage Finance Agency (NJHMFA) offers several down payment assistance programs for qualified first-time buyers. The most popular is the NJHMFA Down Payment Assistance Program, which provides up to $15,000 in the form of a forgivable, zero-interest loan for eligible buyers purchasing in New Jersey.
The program is structured as a five-year forgivable loan. If you remain in the home for five years, the entire amount is forgiven and you do not have to repay a cent. If you sell or move before five years, you repay a prorated portion.
Key eligibility requirements for NJHMFA down payment assistance:
- Must be a first-time home buyer (or not have owned a home in the past three years)
- Must complete a home buyer education course approved by NJHMFA
- Income limits apply based on county and household size (typically around $86,000 to $130,000 depending on location)
- Purchase price limits vary by county and program
- Must use an NJHMFA-approved lender
- The home must be your primary residence
In Burlington County, the income limits for the standard program are generally more generous than in the northern part of the state, making it accessible to many working families.
What Other NJHMFA Programs Are Available?
Beyond the standard down payment assistance program, NJHMFA offers several other programs that first-time buyers in South Jersey should know about:
NJHMFA Police and Firefighter Program
This program offers reduced mortgage interest rates and down payment assistance specifically for active or retired police officers and firefighters. It is an excellent benefit for first responders looking to buy a home in Burlington County.
NJHMFA Teachers Program
Similar to the Police and Firefighter Program, this one is designed for full-time teachers and school administrators. If you work in a New Jersey public school, including districts in Burlington County like Moorestown, Medford, Mount Laurel, or Lenape Regional, you may qualify for reduced rates and down payment assistance.
NJHMFA Mortgage Revenue Bond (MRB) Program
This program provides below-market interest rate mortgages to first-time buyers who meet income and purchase price limits. It can be combined with down payment assistance for maximum savings. The interest rate is typically 1% to 2% below market rates, which can save you tens of thousands over the life of your loan.
What About FHA Loans for First-Time Buyers?
FHA loans are insured by the Federal Housing Administration and are one of the most popular options for first-time buyers. They offer several advantages that make homeownership accessible with less cash upfront.
FHA loan benefits:
- Down payment as low as 3.5%
- Credit score minimum of 580 for 3.5% down (500-579 may qualify with 10% down)
- Competitive interest rates
- Higher debt-to-income ratios allowed than conventional loans
- Gift funds from family members can be used for the down payment
The main drawback of FHA loans is the mortgage insurance premium (MIP). You will pay an upfront MIP of 1.75% of the loan amount, plus an annual MIP (typically 0.55% to 0.85%) for the life of the loan if your down payment is less than 10%. However, for many first-time buyers, the lower down payment and flexible credit requirements make FHA loans the right choice.
If you are comparing FHA and conventional loans, see our detailed FHA vs conventional comparison for a side-by-side breakdown.
Are VA Loans Available for Eligible Buyers?
If you are a veteran, active-duty service member, or surviving spouse, a VA loan is one of the most powerful home buying tools available. VA loans are backed by the U.S. Department of Veterans Affairs and offer terms that are unmatched by any other loan program.
VA loan benefits:
- Zero down payment required in most cases
- No private mortgage insurance (PMI)
- Competitive interest rates
- No official minimum credit score (most lenders look for 620+)
- Limitations on closing costs sellers can require buyers to pay
There are several active military bases within commuting distance of Burlington County, including Joint Base McGuire-Dix-Lakehurst. Many veterans choose to settle in the Burlington County area for its quality of life, excellent schools, and proximity to the base.
What About USDA Loans in Rural Areas?
USDA loans, backed by the U.S. Department of Agriculture, offer zero-down financing for homes in eligible rural and suburban areas. Many parts of Burlington County qualify for USDA loans, including portions of Medford, Shamong, Tabernacle, Southampton, Lumberton, and other communities.
USDA loan benefits:
- Zero down payment required
- Low mortgage insurance compared to FHA loans
- Competitive interest rates
- Credit score minimum typically 640
- Income limits apply (generally 115% of the area median income)
The USDA loan is an excellent option for buyers who want to live in the more rural parts of Burlington County but do not have a large down payment saved. Many of the communities I serve, like Medford Lakes, Southampton, and Tabernacle, are in USDA-eligible areas.
Are There Local Down Payment Assistance Programs in Burlington County?
Some municipalities and counties in New Jersey offer their own down payment assistance programs. While state-level NJHMFA programs are the most widely available, it is worth asking about local programs in the specific town where you are looking to buy.
Burlington County has periodically offered county-level assistance programs through the Burlington County Community Development Office. These programs are typically funded through federal HOME Investment Partnerships Program allocations and can provide grants or low-interest loans to qualified buyers. Availability varies, so I recommend checking with your lender about currently active local programs in your target town.
Can I Combine Down Payment Assistance With Other Programs?
Yes, in many cases you can combine NJHMFA down payment assistance with an FHA, conventional, or VA loan. This is called a "stacked" or "layered" assistance strategy, and it can significantly reduce your upfront costs.
For example, you might use an FHA loan requiring 3.5% down on a $350,000 home ($12,250 down payment) and pair it with a $10,000 NJHMFA down payment assistance grant, reducing your out-of-pocket down payment to just $2,250 plus your closing costs. That makes homeownership achievable with far less cash than most people expect.
How Do I Apply for Down Payment Assistance in New Jersey?
The application process for NJHMFA down payment assistance is straightforward:
- Find an NJHMFA-approved lender. Not all lenders participate in NJHMFA programs. Your real estate agent can connect you with lenders who specialize in these programs.
- Complete a home buyer education course. NJHMFA requires a HUD-approved home buyer education course. These are typically available online or in-person and take 4 to 8 hours to complete.
- Submit your loan application. Your lender will help you apply for both the mortgage and the down payment assistance simultaneously.
- Receive your commitment letter. Once approved, you will receive a commitment letter outlining the amount and terms of your assistance.
- Proceed to closing. The assistance funds are applied at closing, reducing the cash you need to bring to the table.
The entire process from application to approval typically takes 30 to 60 days, similar to a standard mortgage timeline. I always recommend starting the conversation early so you have time to complete the education requirement and gather your documentation.
Frequently Asked Questions
How much down payment assistance can I get in New Jersey?
The NJHMFA Down Payment Assistance Program provides up to $15,000 in the form of a forgivable, zero-interest loan. The amount you qualify for depends on your income and the purchase price of the home. Additional assistance may be available through local county or municipal programs.
Do I have to repay NJHMFA down payment assistance?
The NJHMFA down payment assistance is a forgivable loan. If you remain in the home for five years, the entire amount is forgiven and you do not need to repay it. If you sell or move before five years, you repay a prorated portion based on how long you have lived in the home.
What credit score do I need for down payment assistance programs?
The credit score requirement depends on the mortgage program you pair with the assistance. FHA loans paired with NJHMFA assistance typically require a minimum score of 580. Conventional loans usually require 620 or higher. See our credit score guide for a complete breakdown.
Can I use down payment assistance for closing costs?
Yes, NJHMFA down payment assistance can be applied to both the down payment and closing costs. This flexibility makes it especially valuable for first-time buyers who need help covering all the upfront expenses associated with buying a home in New Jersey.
Are there income limits for NJHMFA programs?
Yes. Income limits vary by county and household size. In Burlington County, the limits are generally between $86,000 and $130,000 depending on the specific program and the number of people in your household. Your lender can tell you exactly what limits apply to your situation.
Is down payment assistance only for first-time buyers?
Most NJHMFA programs are designed for first-time buyers, defined as someone who has not owned a home in the past three years. However, some programs, like the NJHMFA Police and Firefighter and Teachers programs, may be available to non-first-time buyers. Veterans using VA loans are not subject to first-time buyer restrictions.
Ready to Explore Your Options?
Down payment assistance programs in New Jersey can make homeownership far more attainable than most people realize. Whether you qualify for NJHMFA grants, an FHA loan with 3.5% down, or a zero-down VA or USDA loan, the first step is understanding what is available and finding the right lender to guide you.
I have helped hundreds of first-time buyers in Burlington County and South Jersey navigate these programs and find the financing that works for them. I do not sell loans, but I can connect you with trusted local lenders who specialize in first-time buyer programs and down payment assistance.
My approach is built on education, transparency, and zero pressure. If you are curious about how much home you can afford and what assistance you might qualify for, I would love to help you get the answers you need.
Bob Millaway
Epique Realty Agent and AI Certified Agent with 20+ years of experience and 636+ homes sold across Burlington County and South Jersey. Licensed NJ Salesperson #791082. Bob combines local expertise, honest guidance, and cutting-edge technology to help buyers and sellers make confident real estate decisions.