How CEMA Loans Can Lower Your Closing Costs? | reAlpha Mortgage

Whether you're refinancing or buying a high-value property in New York, you could be facing thousands in mortgage recording taxes alone. But here’s the good news - a CEMA loan (Consolidation, Extension, and Modification Agreement) can significantly reduce those costs, making it a smart move for eligible transactions in the Empire State.

• A CEMA loan can significantly reduce mortgage recording taxes.
• Ideal for refinancing or purchasing with an existing mortgage.
• Requires lender cooperation and legal documentation.
• Not exclusive to VA borrowers, it's available to a wide range of applicants.

Let’s sort through the confusion and show you exactly how CEMA loans work, who qualifies, and how to apply - without falling into compliance traps or surprise fees.

A CEMA loan is a unique type of mortgage transaction that is available only in New York. Instead of taking out a brand-new loan, a CEMA lets you transfer your existing mortgage balance to a new lender, reducing how much is taxed under the Mortgage Recording Tax (MRT).

• NY mortgage tax can cost 1.8% to 1.925% of your loan amount - on a $500K loan, that’s nearly $10,000.
• With CEMA, you only pay tax on new money (like cash-out or additional financing).

Pro Tip: CEMA works for both purchases (assignment CEMA) and refinances (refinance CEMA).

Find the Perfect Mortgage for Your Dream Home with reAlpha Mortgage.

Compare options, calculate payments, and get expert guidance - all in one place.

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This isn't a one-size-fits-all loan, but it’s more accessible than many think. Here’s who can benefit:

• You own property
• You’re refinancing or purchasing with an assigned mortgage.
• Your current lender agrees to the CEMA process.
• The loan type is Conventional, Jumbo, or FHA - no VA-specific limitation here.

• Some lenders may charge a CEMA processing fee.
• It requires legal coordination, so the timeline and paperwork may be slightly longer.

But don’t worry - we’ve got you covered with lenders who streamline this process.

reAlpha Mortgage specializes in simplifying complex loans like CEMA, making your refinance smoother, smarter, and more rewarding.

1. Apply for a new loan with a lender that supports CEMA.
2. The existing lender agrees to assign the outstanding mortgage.
3. An attorney drafts the CEMA agreement, consolidating the old and new loan amounts.
4. The new lender records only the new money, reducing your mortgage tax bill.

This could save you thousands with very little added complexity.

Let’s say you’re refinancing a $700,000 mortgage in Brooklyn. Without CEMA, you’d owe ~$13,475 in mortgage recording taxes.

Using CEMA? You’re only taxed on the new loan portion. If that’s $50,000, your tax drops to around $950.

That’s a $12,000+ savings - and that’s money back in your pocket.

Navigating lender policies, attorney docs, and compliance can be daunting.

But reAlpha and reAlpha Mortgage make it seamless - with smarter mortgage tools, CEMA-friendly support, and up to 75% commission rebate when you bundle services.

There’s no legal minimum, but most lenders offer CEMA on loans over $250,000 due to cost justification.

Yes - if the seller’s mortgage is assignable and the lender participates.

Typically 30–60 days, slightly longer than a standard loan due to legal coordination.

No - your rate is based on market conditions and lender pricing, not the CEMA structure.

No. CEMA applies to a variety of loan types. This guide does not focus on VA loans specifically.

Closing costs in New York can drain thousands from your budget - but they don’t have to. With a CEMA loan and reAlpha Mortgage, you can keep more of your money where it belongs: in your pocket.

Better yet, reAlpha helps you unlock up to 75% of the buyer agent’s commission as a rebate.

• Get 25% back when you use a reAlpha agent

• Reach 50% by financing with reAlpha Mortgage

• Unlock the full 75% when you bundle with reAlpha Title

That’s real cash - for closing costs, upgrades, or your next investment.

Explore your savings now at reAlpha Mortgage.

• NMLS #1743790 – reAlpha Mortgage
• This blog is for informational purposes only and does not constitute a commitment to lend.
• All loans are subject to credit approval, lender participation in CEMA, and applicable legal review.
• Rates, terms, and eligibility guidelines may vary and are subject to change.
• reAlpha is a homebuying platform offering buyer commission rebates - up to 75% when bundling agent, mortgage, and title services.
• VA-specific benefits are not discussed in this blog.
• Always consult a licensed mortgage advisor for tailored advice.
• Instruction: Replace the entire disclosures section.

Find the Perfect Mortgage for Your Dream Home with reAlpha Mortgage.

Compare options, calculate payments, and get expert guidance - all in one place.

Check if you qualify