Effective Date: February 1, 2019 for new and existing reservations
Attention Lenders:
In response to your questions, we have updated the R&E form with two additional numbered points, which are also added to the original bulletin below, listed in red.
NJHMFA now allows Renegotiation and Extension (R&E) for eligible NJHMFA products. Below outlines the R&E Request Process:
The R&E Rules of Engagement:
R&E must be requested by the borrower, and may not be solicited by the Lender.
R&E may only be requested no more than 40 days and no less than five days prior to closing.
The R&E Request Form:
The R&E request must be completed by the lender using the official form found on the Lender Resources Page (see link below or access the form directly here), and submitted to sflenders@njhmfa.gov.
Renegotiation and Extension Terms:
R&E will be applied at the current market interest rate for the applicable product, plus 0.125%. For example, if the loan locked at 6% and market is 5.5%, the R&E will bring the rate to 5.625%.
R&E application will result in a decrease of 0.25 to the Lender’s loan price. For example, if the loan price had been 102.375, the new loan price will be 102.125.
R&E application will result in an extension of the lock expiration date by three business days to allow time for proper re-disclosures to be completed.
Any applied adjustments to the rate sheet price remain applicable to the loan, including extensions applied prior to the R&E or after the R&E.
Eligible products are limited to these specific programs: Homeward Bound and First Time Home Buyer programs. All other programs are ineligible for the R&E process.
R&E fees must not be passed on to the borrower.
Participating Lenders that wish to restrict R&E submissions to certain authorized users may submit the approved roster of signers to sflenders@njhmfa.gov
Please see bulletin 2019-2 (which will be sent immediately following this bulletin) for a summary of changes to the updated 2019 Seller's Guide.
