The New Jersey Department of Banking and Insurance recently published Bulletin 22-02 regarding the annual review of the definition of a “high-cost home loan” under the New Jersey Home Ownership Act of 2002 (the “Act”). A residential mortgage loan is not subject to the triggering provisions of the Act as a “high-cost home loan” if the principal loan amount exceeds a maximum threshold amount, which is adjusted annually (N.J.S.A. 45:10B-22 to -35).
The adjustment is “based on the last published increase in the housing component of the national Consumer Price Index, New York – Northern New Jersey Region.” Reflective of increasing home prices, the definition of “high-cost home loan” has been adjusted so that the maximum principal amount of a loan that may be considered high-cost increased from $513,782.50 for 2021 to $527,669.59 for 2022.
The new principal amount threshold is effective for all completed loan applications that are subject to the Act and received on or after January 1, 2022, retroactively.
DocMagic will be updating the New Jersey High-Cost Test and applicable audits to consider the increased amount on January 27, 2022.
If you have any questions, please contact DocMagic’s Compliance Department.
