Is CEMA Worth It?
Now that you know what CEMA in NY is, it’s time to decide whether this loan type is right for your situation. Every loan type has advantages and disadvantages. Here’s what you should consider before moving forward with a CEMA loan.
Pros Of A CEMA Loan
Homeownership is expensive, and owning real estate in the state of New York is very expensive. That’s especially true in New York City. So, it makes sense that one of the most attractive benefits of a CEMA loan is the avoidance of additional mortgage recording tax.
It’s possible to save thousands upfront by choosing a CEMA loan over a traditional mortgage refinance. Additionally, you can potentially tap into a lower interest rate and reduce closing costs with a CEMA loan.
Cons Of A CEMA Loan
While a CEMA loan does save you money in many cases, it’s not necessarily the quickest process. The state of New York, and any previous lender, must do some special signing off in order to get the mortgage and title transfers processed under CEMA regulations, allowing you to pay taxes only on the new money in the transaction rather than the full principal balance .
This means that CEMA refinances are going to require a little more patience than your typical refinance. It may take 60 – 90 days to close your loan. However, they’ll keep you updated throughout the process.
If, for some reason, you really need your loan to close quickly, you can look at other refinance types. Just be aware that you could pay additional taxes in exchange for that speed.