Applying for a mortgage can be a difficult undertaking. There are many different options available when you are trying to finance the purchase of a home, and it is important to understand the terms and conditions of different mortgages, as well as the interest rate. Whether the interest rate is fixed or adjustable (and the amount of the interest rate) can make a big difference as to whether a purchase is wise, and it is also important to look at the closing costs, or the fees charged to process the mortgage. When buying a home, you may also want to look at whether a lender offers MassHousing mortgages. The real estate lawyers at Pulgini & Norton can guide Boston residents through this complex process.
Considering a MassHousing MortgageOne of the first considerations when buying a home is determining which homes you can afford. Many people mistakenly believe that they cannot get a loan because they have a low income. There are specific programs in Massachusetts designed to help low-income buyers.
The Massachusetts Housing Finance Agency (MassHousing) is a quasi-governmental agency, the purpose of which is to increase affordable housing options and address the housing needs of underserved communities. MassHousing mortgages are considered straightforward, safe, and affordable. The loans are provided by lending partners around Massachusetts. They can be used to buy a home or refinance it.
The interest rates for MassHousing mortgages are fixed for the life of the loan and must be repaid over a 30-year period. There are loans available that do not require you to buy private insurance. Some include mortgage payment protection, which helps borrowers pay their loan for up to six months in case they lose their job. There are no hidden fees, and there are options to make a low down payment (as low as 3%). These loans have flexible underwriting and income limits. This means that more people qualify for these loans. In order to obtain a MassHousing mortgage, you need to have good credit, buy a 1-4 family property, and complete a course on buying a home.
Another option for low-income homebuyers is an FHA loan. These often have lower interest rates and more relaxed qualification standards than MassHousing loans. However, MassHousing loans may be more feasible when you do not have a lot of money for the down payment and you want lower monthly payments. Since the FHA often has a lower interest rate, there are often higher monthly payments. However, you should be aware that if you choose a MassHousing mortgage that does not require you to get mortgage insurance, the rate is going to be higher than an FHA loan's rate. There are tax consequences to your mortgage decisions. Therefore, it is important to look closely at which one is actually cheaper over the long haul.
Consult a Property Transactions Lawyer in BostonFor many people, buying a home is the biggest purchase of their lives. However, many people do not look at the total cost over time when choosing the types of mortgages for which to apply. The experienced Boston attorneys at Pulgini & Norton can offer diligent advice on home mortgages and provide an understanding of how certain options compare to other comparable programs. We also represent people in Quincy, Braintree, Andover, and other cities in Massachusetts. Call us at 781-843-2200 or contact us via our online form for a free consultation.