Mortgage

Massachusetts First Time Dwelling Patrons: Packages and Grants for 2021

What You Should Know About Buying a Home in Massachusetts

Buying your first home is sure to be stressful. However, if this is your first time buying a Massachusetts home, you can expect a lot of support.

Bay State offers a lot of guidance for first-time buyers, from home ownership advice and educational courses to down payment or loans that could help you buy a home much sooner than you could have dreamed of. How to start

Check Your Massachusetts Home Buying Eligibility. Start here (23.08.2021)

In this article (continue to …)

Massachusetts Home Buyer Summary

The average home price in Massachusetts was $ 555,000 in June 2021, according to The Warren Group. That was 26.1% more than in the previous year.

Such huge price hikes are a serious challenge for first-time home buyers in Massachusetts. If the goal keeps moving, how can you hope to meet your savings goals?

Read on to learn more about down payment assistance that could help you make up for any shortfalls.

Massachusetts Home Buyer Summary

Average home sale price in MA
$ 555,000

Minimum deposit in employees (3%)
$ 16,650

20% deposit in MA
$ 111,000

Average credit score in MA1
729

Maximum MA home buyer allowance2
5% of your purchase price capped at $ 15,000 or $ 25,000 depending on where you buy (MassHousing, details below)

Down payment amounts are based on the last available average home sale price in the state. A “minimum” down payment is assumed to be 3% less than a conventional mortgage with a minimum credit rating of 620.

If you are eligible for a VA loan (supported by the Department of Veterans Affairs) or a USDA loan (supported by the U.S. Department of Agriculture), you may not require a down payment at all.

Check Your Massachusetts Home Buying Eligibility. Start here (23.08.2021)

Initial Loans for Massachusetts Homebuyers

If this is your first time buying a Massachusetts home with a 20% down payment, you can get a conventional loan with a low interest rate. And you never have to pay for personal mortgage insurance (PMI).

Of course, only a few first-time buyers have saved enough for 20 percent. But the good news is you don't need that much. By far not.

Borrowers can often move into a new home as little as 3% or even 0% with one of these low down payment mortgage programs:

Conventional 97 – From Freddie Mac or Fannie Mae. 3% down payment and at least 620 credits. You can usually stop paying mortgage insurance after a few yearsFHA loans – Supported by the Federal Housing Administration. Down 3.5% and a credit score of at least 580. But you're looking for mortgage insurance until you refinance, move, or pay off your loan on a different type of mortgageVA loan – Only for veterans and service members, reservists and the National Guard. A zero deposit is required. The minimum credit score varies by lender, but is often 620. No ongoing mortgage insurance upon completion. These are arguably the best mortgages available. So apply when you are eligibleUSDA loan – For low to middle income people who shop in designated rural areas. Zero deposit required. The creditworthiness requirements vary depending on the lender, but often 640. Low mortgage insurance ratesONE State of Massachusetts Mortgage Program – May include competitive interest rates and can be used with down payment assistance. More information below

Depending on the mortgage loan you choose, you may be able to get into your new home with minimal cash out of your pocket.

With these programs, you can even use free cash or Down Payment Assistance (DPA) to help cover down payment and closing costs.

If you are unsure which program to choose for your first mortgage loan, your lender can help you find the right deal based on your finances and your home purchase goals.

Find the First Time Buyer Loan that is Best for You (23 Aug 2021)

MA programs for first time home buyers

MassHousing is a great place to start for any first-time home buyer in Massachusetts.

This organization provides links to homebuyer information and training courses – both nationally and locally – on the Housing Consumer Education Centers website. Most first-time mortgages require you to take such a course before you can apply.

For example, if you want to apply for MassHousing's ONE Mortgage, you must complete a homebuyer training course.

This loan program, offered by participating lenders, can provide you with a competitive fixed rate mortgage with a 3% down payment. And you can use the Down Payment Assistance (DPA) money for these expenses.

But perhaps the best news is that MassHousing mortgages do not have private mortgage insurance and offer "extra assistance" to lower your mortgage payments.

In fact, the website states, "With these features, ONE Mortgage can cut your monthly payments by hundreds of dollars each month compared to other 30-year mortgages."

Eligibility requirements include a first time homeowner with a minimum credit score of 640. In addition, your total assets must be less than $ 75,000 and your household income must be below local income limits.

You can see local income limits here and explore other requirements on the program's website.

MA first-time occupation grants for own homes

There are a variety of down payment and closing expense assistance programs available locally in Massachusetts and across the country. Your real estate agent and / or loan officer can help you identify the programs you might be eligible for.

MassHousing has its own deposit support programs. But his website offers very little information about it. So it can be grants, forgivable loans, or repayable loans.

MassHousing invites you, "Call us at 888-843-6432 to speak to our home buying experts" with any questions. First, ask what type of deposit assistance is offered and if you are eligible.

MassHousing tells you how much help you could get. In most parts of Massachusetts, you can get up to 5% of your purchase price, which is capped at $ 15,000.

If you buy in any of the Commonwealth's 26 “gateway cities” that cap increases to $ 25,000 – although it's still capped at 5% of your home purchase price.

These gateway cities include:

Attleboro, Barnstable, Brockton, Chelsea, Chicopee, Everett, Fall River, Fitchburg, Haverhill, Holyoke, Lawrence, Leominster, Lowell, Lynn, Malden, Methuen, New Bedford, Peabody, Pittsfield, Quincy, Revere, Salem, Springfield, Taunton, Westfield and Worcester

See below if you are looking for help buying a house in Boston.

Check Your Massachusetts Home Buying Eligibility. Start here (23.08.2021)

Buy a home in major Massachusetts cities

As you'd expect, Boston is by far the most expensive city in the Bay State for residential real estate. The good news, however, is that Boston property prices have remained stable between mid-2020 and mid-2021.

The next two largest cities, Worcester and Springfield, are significantly cheaper. But the bad news is that prices there rose rapidly over the same period.

Boston first-time home buyers

The average list price in Boston in July 2021 was $ 799,000, according to Realtor.com. That was constant year-on-year. So house price inflation in the city was zero between July 2020 and the same month a year later.

If you want to buy a home at this average price, your down payment options can be between the following options:

$ 23,970 for 3% deposit$ 159,800 for 20% deposit

The Boston Home Center can lend you up to $ 30,000 as a down payment aid for a single family home. These loans do not charge interest and you do not have to make any monthly payments. However, you will have to repay it in full if you “refinance, or if you transfer ownership, sell or no longer keep the home as your primary residence”.

A list of the eligibility criteria can be found on the website. But one is that your income cannot exceed 135% of the median income in the region. For a family of four who live in Boston, that's $ 101,050, according to the website.

Worcester first time home buyers

The average list price in Worcester in July 2021 was $ 350,000, according to Realtor.com. That was 16.7% more than in the previous year.

If you want to buy a home at this average price, your down payment options can be between the following options:

$ 10,500 for 3% deposit$ 70,000 for 20% deposit

Worcester City Housing and Neighborhood Grants Program has a handy PDF download of the Down Payment Assistance Offer. You should read this for all the information you need.

It seems you can get up to $ 5,000 in help filling the “affordability gap”, provided you're eligible. There are caps on household income and wealth.

This support comes in the form of a forgivable second mortgage. And that means you don't make any monthly payments or pay interest. However, you must repay the loan plus interest if “the property is sold or transferred in whole or in part (including refinancing) during the first three (3) years of ownership, or in the event of default under the conditional agreement (for example, the borrower's failure to return the apartment as main residence). "

As long as you don't sell, refinance, or move within 3 years, you don't owe a penny on this loan.

First time home buyer in Springfield

The average list price in Springfield in July 2021 was $ 229,900, according to Realtor.com. That was 17.9% more than in the previous year.

If you want to buy a home at this average price, your down payment options can be between the following options:

$ 6,900 for 3% deposit$ 45,980 for 20% deposit

The Springfield City Down Payment Support Program offers up to $ 4,000 in financial aid. You can offset this against your down payment or part of your closing costs.

As with the Worcester program, this comes in the form of a forgivable second mortgage. So there are no monthly payments and no interest fees.

However, in the case of Springfield, the loan is waived at a rate of 20% per annum over five years. If you sell, refinance, or move out during those five years, you'll need to pay back the outstanding portion. For example 80% after the end of year 1 or 20% after year 4. After year 5 you owe nothing.

Click the link above to read the full legal version of this summary, as well as other terms and eligibility criteria. However, you must be in a low- or middle-income household to qualify.

Where to Find Home Buying Help in Massachusetts

All of the organizations listed above should provide free advice to any first-time home buyer in or near the Commonwealth of Massachusetts.

In addition to our selections, the US Department of Housing and Urban Development (HUD) offers some lists for statewide, regional, and local resources:

State and regional programs for first time home buyers in Massachusetts

You can view a list of programs by city and town on the HUD website here.

What are the current mortgage rates in Massachusetts?

Here you can see the latest live mortgage rates in Massachusetts.

When you're ready to start buying your home, make sure you get personalized interest rate quotes from at least three mortgage lenders.

Don't just look at the advertised prices online; Indeed, apply for pre-approval and compare the interest rates and fees that are offered to you. This is the only way you can be sure that you are getting the best possible offer for your new home loan.

Confirm your new price (August 23, 2021)

1 Source: Experian.com 2021 study on 2020 data

2Based on a review of available state DPA grants at the time of this writing

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