First-Time Homebuyer Guide for Massachusetts

Buying your first home is exciting but can feel overwhelming. This guide walks you through the process step-by-step, with specific tips for Massachusetts homebuyers.

Step 1: Assess Your Financial Readiness

Check Your Credit Score

Your credit score significantly impacts your mortgage rate. Aim for:

• 760+: Best rates
• 700-759: Good rates
• 620-699: Acceptable, but work on improving

Calculate How Much You Can Afford

A general rule: your monthly housing payment shouldn't exceed 28% of your gross monthly income.

Save for Down Payment and Closing Costs

• Down Payment: 3-20% of purchase price (20% avoids PMI)
• Closing Costs: 2-5% of loan amount
• Emergency Fund: 3-6 months of expenses

Step 2: Get Pre-Approved

Pre-approval shows sellers you're a serious buyer and helps you understand your budget. You'll need to provide:

• Pay stubs (last 2 months)
• Tax returns (last 2 years)
• Bank statements (last 2 months)
• Employment verification
• Credit authorization

Step 3: Find a Real Estate Agent

A good agent helps you navigate the Massachusetts market, which can be competitive. Look for someone who:

• Knows your target neighborhoods
• Has experience with first-time buyers
• Communicates well
• Has strong negotiation skills

Step 4: House Hunting

What to Look For

• Location: Commute, schools, amenities
• Condition: Major repairs needed?
• Size: Current and future needs
• Resale Value: Will it appreciate?

Massachusetts-Specific Considerations

• Property taxes vary significantly by town
• Heating costs (winters are cold!)
• Condo fees (common in urban areas)
• Historical home restrictions

Step 5: Make an Offer

Your offer should include:

• Purchase price
• Earnest money deposit (typically 1-3%)
• Contingencies (inspection, financing, appraisal)
• Closing date

Step 6: Home Inspection

Never skip the home inspection! It typically costs $300-500 but can save you thousands. The inspector will check:

• Structural integrity
• Roof condition
• Plumbing and electrical systems
• HVAC systems
• Foundation

Step 7: Finalize Your Mortgage

Once your offer is accepted:

1. Complete full mortgage application
2. Lock in your interest rate
3. Provide any additional documentation
4. Review Loan Estimate carefully
5. Get homeowners insurance quotes

Step 8: Closing

At closing, you'll sign final documents and pay closing costs. Bring:

• Government-issued ID
• Cashier's check or wire transfer for closing costs
• Proof of homeowners insurance

Massachusetts First-Time Homebuyer Programs

MassHousing

Offers low-interest mortgages and down payment assistance for eligible buyers.

ONE Mortgage Program

Provides affordable mortgages with flexible guidelines and down payment assistance options.

FHA Loans

Federal program allowing down payments as low as 3.5% with credit scores as low as 580.

Common First-Time Buyer Mistakes to Avoid

1. Not getting pre-approved: You'll lose out to buyers who are
2. Maxing out your budget: Leave room for unexpected expenses
3. Skipping the inspection: Could cost you thousands later
4. Not shopping for rates: Even 0.25% difference matters
5. Forgetting about closing costs: Budget 2-5% of loan amount
6. Buying more house than you need: Higher costs for everything

Why Compare Credit Union Rates?

Massachusetts credit unions often offer first-time homebuyer programs with:

• Lower interest rates
• Reduced fees
• Down payment assistance
• Personalized guidance