Mortgages, in plain language

Why this page exists

If you are buying in Hoboken, Jersey City, Bayonne, or anywhere else in Hudson County — or selling a home that still has a mortgage — the loan is usually the largest piece of the puzzle. I wrote this in everyday language so you can walk into a lender’s office, or a closing, knowing what the words mean.

I am Jose Martinez (Joselito), a licensed New Jersey real estate salesperson with Nest Seekers (Lic. 1431438). I am not a mortgage lender, and I do not take loan applications. I worked at Norwest Mortgage, a Wells Fargo company, in the late 1990s, and I have published a Homes & Money newsletter since 1998. That background helps me explain payments, payoffs, and lender timelines. The decision to lend, and the rate, always belong to a lender.

I can connect you with trusted local lenders. I do not name a single company here, and you are free to use any lender you choose. Where a specific number would normally appear — a rate, a down-payment rule, a loan limit — ask your lender. Those figures change, and they depend on your file.

Get pre-approved before you house-hunt

A pre-approval is a lender’s early look at your income, credit, and assets, before you fall in love with a kitchen. In Hudson County, sellers and listing agents often want to know a buyer is already in a real conversation with a lender. Start there. Then we tour homes.

Bring the documents your lender asks for, and ask them what monthly payment fits the loan they have in mind. I will not guess a rate for you on this page. When you have a number from the lender, you can type it into the calculator below and see how taxes, insurance, and a condo fee change the month.

Pre-approval is not the same as a final loan commitment. The lender still reviews the property, the building, and the contract. If something in that review needs a real estate explanation — a condo questionnaire, an estate sale, a house that will be sold as-is — that part is my work.

What goes into a monthly payment

People shorten the housing payment to PITI: principal, interest, taxes, and insurance. Principal pays down what you borrowed. Interest is the cost of borrowing. Property taxes are set by the town, not by the lender, and in New Jersey they vary a great deal from one municipality to the next. Homeowners insurance is a yearly premium, usually collected monthly with the loan.

In many Hudson County buildings there is also a monthly HOA or condo fee. That fee is not part of the loan, but it is part of the month you actually live. If the down payment is under 20%, many loans add private mortgage insurance — PMI — until there is more equity. Some loans handle mortgage insurance differently. Your lender will say which kind, if any, applies to you.

The calculator on this site adds those pieces together from numbers you type. It does not look up a live rate, and it is not an offer.

Common loan types, in general terms

These are the names buyers hear most often. I am describing them only in general. Program rules, minimum down payments, and loan limits change, and I will not invent them here.

• Conventional

  A common loan for buyers who meet a lender’s own guidelines for credit, income, and down payment. What “enough” means is the lender’s answer, not a number I publish.

• FHA

  A government-backed option some buyers use when a smaller down payment or a different credit picture fits the file. Ask a lender what is required right now. I will not quote a minimum.

• VA

  For eligible veterans, service members, and some surviving spouses. Eligibility is confirmed by the VA and the lender. A real estate agent cannot grant it.

• Jumbo

  For loan amounts above the conforming limit. Many higher-priced Hoboken and Jersey City homes land in this category. I will not quote this year’s limit. Your lender will.

• Two- to four-family, owner-occupied

  Some buyers live in one unit and rent the others. Hudson County has many two-, three-, and four-family houses. Financing a home you will partly occupy is its own conversation with a lender who knows multi-family files. Rental income, if a lender counts it, is their calculation.

Down payment and closing costs

The down payment is the cash you bring toward the price. The rest is the loan, if the lender approves it. A larger down payment usually means a smaller loan and, at 20% or more, often no PMI. It is not the only cash you need.

Closing costs sit beside the down payment. Common categories include lender fees, title work, the attorney, and prepaid taxes and insurance. How much cash to bring depends on the loan, the building, and the contract. Ask your lender for a written estimate, and ask your attorney what the title side looks like. I will not put a percentage on this page and call it a rule.

If you are selling, the buyer’s loan is their business — and your own mortgage, if the home still has one, is handled as a payoff at closing. That is the next section.

How a mortgage payoff works when you sell

When an inherited home, a probate sale, or a pre-foreclosure still has a loan, that loan is usually paid from the sale proceeds at closing. The title company or the attorney orders a payoff letter from the servicer — the company that collects the monthly payment. The servicer is often not the bank that originally made the loan.

A payoff letter states what is owed through a specific date, including interest and any fees the servicer lists. It is a snapshot, not a forever number. If closing moves, someone has to ask for an updated letter. Call the servicer early. Estates sometimes need the executor or administrator on the phone, with Letters from the Surrogate in hand, before the servicer will discuss the account. Your attorney leads that legal step. I do not.

In pre-foreclosure, an early call can clarify what a sale has to cover and which deadlines are real. New Jersey foreclosures run through the courts, and sale dates move. I am not a HUD-approved housing counselor, and I do not negotiate the debt. If counseling or legal advice is the right next call, I will say so. My work is the real estate: price, access, and a sale that can actually close.

This is general information, not legal advice. Probate authority, a short sale, or a foreclosure timeline belongs with your attorney and, when it helps, a housing counselor.