What You Should Know
Princeton University’s mortgage services group oversees programs that assist faculty and staff with the purchase of a home in the Princeton area. Through the Standard Mortgage Program (SMP), the University offers favorable mortgage rates and terms to eligible faculty and staff.
In addition to being eligible for the program, the property itself must be eligible and loan requirements must be met.
These loans are administered by the University and mortgage payments are made through payroll deduction.
Note: Effective July 1, 2012, the University will make changes to the Standard Mortgage Program. Please click here for a summary of the changes.
Eligibility
Eligibility for the standard mortgage program is determined by position or rank, employment standing, and, in some cases, duration of employment with the University. Princeton University retirees are not eligible for a new mortgage through the program.
If you are in negotiations for a faculty or staff position eligible for the program, contact mortgage services.
If You Aren’t Eligible for the Standard Mortgage Program
Employees in term positions normally are not eligible for participation in the standard mortgage program. However, you may be eligible for a favorable mortgage through two external lenders with which the University has relationships.
For further clarification on eligibility, contact mortgage services.
ELIGIBILITY FOR THE STANDARD MORTGAGE PROGRAM (SMP)
1 - These ranks are eligible.
2 - These ranks require a letter of recommendation from the department head or chair confirming the employee is in good standing and that his/her employment is expected to continue.
3 - Main campus IT professional staff (rank 020), PPPL and scientific staff (ranks 5 and 6), and engineering associate staff (ranks 2 and 3) are eligible to participate in the SMP after one year in that rank. These ranks also require a letter of recommendation from their department head or chair.
| POSITION OR RANK | ELIGIBILITY FOR THE STANDARD MORTGAGE PROGRAM |
| Faculty (three-year appointments or longer) | |
| Full professor | 1 |
| Associate professor | 1 |
| Assistant professor | 1 |
| Lecturer with continuing appointment | 1 |
| Senior lecturer | 1 |
| Lecturer | 1 |
| On-campus research and specialist staff (three-year appointments or longer) | |
| Senior research scholar | 1 |
| Research scholar | 1 |
| Associate research scholar | 2 |
| Senior professional specialist | 1 |
| Professional specialist | 1 |
| Associate professional specialist | 2 |
| On-campus administrative and professional staff | |
| Administrative staff (ranks 5 and 6) | 2 |
| Administrative staff (ranks 7 and above) | 1 |
| Head coach | 1 |
| IT professional staff (rank 020) | 3 |
| IT professional staff (rank 030) | 2 |
| IT professional staff (ranks 040 and above) | 1 |
| Public safety shift supervisor | 2 |
| Senior technical support staff III | 2 |
| Library | |
| Librarian-III and above | 1 |
| Librarian and senior librarian | 1 |
| Associate librarian | 2 |
| Princeton Plasma Physics Lab (PPPL) | |
| Administrative staff (ranks 5 and 6) | 2 |
| Administrative staff (ranks 7 and above) | 1 |
| Staff research physicist (rank of RES 02) | 2 |
| Research physicist (ranks RES 03 and above) | 1 |
| Engineering and scientific staff (ranks 5 and 6) | 3 |
| Engineering and scientific staff (ranks 7 to 10) | 1 |
| Engineering associate staff (ranks 2 and 3) | 3 |
Loan Origination Requirements
Significant terms and conditions of the standard mortgage program include:
- The property must be a single-family home and your primary residence.
- Only first mortgages on newly acquired properties are allowed. The program does not provide mortgage loans for properties owned prior to employment by Princeton University, for a property owned before you became eligible to participate, or for refinancing.
- With the exception of the city of Trenton, purchased property must be located within a nine-mile radius of the central campus. Contact mortgage services to make sure the property is in an eligible location. Eligibility Map
- The loan limit is 90 percent of the appraised value of the property or the purchase price, whichever is lower. The current maximum loan limit allowed is $700,000.
- Buyers pay normal closing costs including, but not limited to, attorneys' fees, title insurance costs, survey fees, and recording fees.
Rates & Terms
The interest rate for the standard mortgage program is 1.5 percent below the prevailing local commercial rate for residential mortgage loans. This rate is locked in for a 90-day period based on the market rate applicable when a completed application is submitted and accepted.
However, during this 90-day period, if the University rate is lower for the month in which the closing actually takes place, the lower rate will apply. If the closing occurs within the first five calendar days of the month, the University rate for the previous month will apply if it is lower.
Rates for May 2012 are:
| Conforming Mortgages (up to $417,000) |
Jumbo Mortgages ($417,001 to $700,000) |
| *40–year: 2.375% 15–year: 1.625% |
*40–year: 3.000% 15–year: 2.375% |
These rates are based on market rates as of May 1, 2012.
Under the program, mortgages are issued in 5 year increments for terms up to 40 years. If you qualify for terms of 20, 25, 30 or 35 years, the 40–year interest rate will apply.
Loan Repayment
- Loans are repaid through payroll deduction as level monthly payments consistent with the way you are paid; either 10- or 12-month installments.
- You may accelerate repayment of your loan by authorizing the mortgage department to increase your payroll deduction, or by submitting additional amounts by check.
- Mortgage loans are due and payable when you no longer are employed by the University (except for retirement), or no longer use the property as your principal residence. Normal standards require repayment of the mortgage balance within 90 days of the end of your University employment.
- Retirees may continue to participate in the standard mortgage program as long as the property is their primary residence and they continue to make required monthly mortgage payments. If you retire, you will receive a monthly billing statement; you may pay by check or online through your checking or savings account.
- If you die while employed or die as a retiree under University guidelines, and were participating in the standard mortgage program, your surviving spouse or registered domestic partner may continue in the program with some restrictions.
If you have questions about mortgage loan repayment, balance or payoff information, of if you are having trouble logging in to your billing account contact Gerald T. Schreffler, Manager, Rents & Mortgages, Loans & Receivables.
