TRENTON, NJ – In an effort to support first-time homeowners, the Senate Community and Urban Affairs Committee on Thursday unanimously advanced legislation sponsored by Senators Troy Singleton and Vin Gopal that would establish the New Jersey First-Time Home Buyer Savings Account Program.
"It is a well-known fact that the key to creating generational wealth is homeownership," said Senator Singleton (D Burlington). "Yet, it can be difficult for lower and moderate income individuals to buy a home. That is why the New Jersey First Time Home Buyer Savings Account Program is needed now more than ever. It will encourage and incentivize saving for a down payment, which is often the biggest hurdle to homeownership."
Under the bill, S335, the New Jersey Housing and Mortgage Finance Agency (NJHMFA) would enter into an agreement with financial institutions that express an interest in establishing first-time homebuyer savings accounts. The agreement would require the financial institution to allow a certified first-time home buyer to open a savings, deposit, investment, or other brokerage account with the financial institution and designate the account in its entirety as a first-time buyer savings account.
"Homeownership and the financial challenges that come with it can be daunting for first-time homebuyers. The establishment of this savings account program will encourage healthy financial decisions for new homeowners," said Senator Gopal (D- Monmouth). "Homeownership is a shrinking market, especially in light of the COVID-19 pandemic. With proposed incentives, this program will benefit New Jersey and new homeowners."
Additionally, the agreement would require the financial institution to allow a first-time homebuyer to contribute cash or other marketable securities to the account and to transfer assets that may be held in another first-time homebuyer savings account or another similar account maintained through a comparable program in another state or jurisdiction.