Obtaining a home loan may be a difficult process because of the different loan options, the paperwork involved, and the qualification process. Getting help from local MA loan specialists will minimize some of the difficulty. In this blog is advice on the benefits of utilizing MA loan specialists.

Benefits of MA Loan Specialists

MA Financing Programs

MA loan specialists stay up to date on community financing programs and grants. They can offer guidance on unique programs and qualification criteria. This is most important for first time home buyers as many of these programs are geared specifically toward them. Some of these programs provide more flexible lending criteria or can save money on closing expenses or interest.

Involvement In The MA Market

Every local market routinely changes and includes unique characteristics. MA loan specialists process loans in the area monthly and may know about some of the patterns and challenges. That knowledge can minimize the possibility of closing delays. Not all issues can be avoided, but local loan specialists will definitely be a benefit.

Level of Service

Even though many business transactions are completed via telephone and email, in some cases a face-to-face meeting is helpful. Utilizing local loan specialists gives you the opportunity to meet and address vital issues. Time zones are also less of a headache. Lastly, local professionals have an image and reputation to maintain and will, as a result, work hard to ensure the satisfaction of local customers

MA Loan Specialists

Purchasing real estate is a huge investment. Local real estate brokers and loan specialists will play a role your home buying experience. MA loan specialists are also a informational resource that you should tap in to. For a list of local MA loan specialists, contact Peter DaMore with Law Offices of Peter T. DaMore Jr., at 781-229-7900 or pdamore@ptdlaw.com.

No closing cost mortgages are usually requested by buyers with few money to bring to closing. The phrase is a bit misleading as there is always a cost to lending money. The way those expenses are recouped by a mortgage company may be structured differently. The following is an explanation of MA no closing cost mortgages, what you should know, and how it compares to programs with closing costs.

What Are No Closing Cost Mortgages

Closing costs exist with all loans because mortgage companies have expenses related to processing mortgages, compensating brokers, etc. In a usual loan, the exact charges are outlined and listed as closing costs. This leads to more money due at closing, which may be a challenge for all home buyers. No closing cost mortgages were developed to minimize this situation.

There are two primary ways that mortgage companies are able to offer no closing cost mortgages. One method is to obtain a larger interest rate, allowing them to recoup the closing costs over time. The other is to roll the closing costs into the amount of the loan.

Pros And Cons

Whether to use no closing cost mortgages must be based on several considerations. If you plan to pay off your mortgage within a few years, then it can be a good option since the higher interest rate would be effective for only a short period of time. This can be true during times where interest rates are high but are expected to lower in the future or if you plan to own a property for only a few years. On the other hand, if you intend to hold a mortgage for the long term, then the expense of an increased interest rate over the years can be significantly higher than simply covering the closing costs now.

It is important to note that no closing costs does NOT mean that money will not be required at closing. Closing costs really only apply to only some items. Other items, such as escrows, are considered pre-paid expenses. They are not put in the closing costs classification and will therefore still be due at closing.

MA No Closing Cost Mortgages

MA no closing cost mortgages may or may not be the best solution for your mortgage needs. To make an educated decision about what financing program works best for you, compare both the interest rate and fees of each loan. Also consider how many years you expect to keep the mortgage and the the long-term cost. Most of this data may be reviewed by requesting a good faith estimate from your lender.

Borrowers with VA mortgages have the option to easily refinance to a better interest rate through a special program. This is often referred to IRRRL which stands for Interest Rate Reduction Refinancing Loan. Any VA approved lender can provide this option. Below is an introduction to streamline refinancing VA loan programs in MA.

Benefits of VA Streamline Refinancing

The VA does not require an appraisal, a credit check, or closing costs (except for a funding fee) on a refinance. These are critical in declining markets. However, specific lenders may include an appraisal or credit check as part of their company risk assessment. Closing costs are almost always assessed by mortgage companies, but the types and sum will differ from one mortgage company to another. VA guidelines allow their funding fee and any lender closing costs to be included in the loan amount so that borrowers can refinance without spending any money out of pocket. There is also an option to roll in the expense of energy improvements on the home.

Qualifying for a Refinance

For streamline refinancing with the program, the current loan must be a VA mortgage. The interest rate on the new loan must also be lower than that of the current mortgage (the one exception to this rule is when refinancing from an ARM to a fixed rate mortgage). Veterans may not receive any cash from the loan proceeds and no other mortgage, other than the original VA loan, may be included in the new loan. Veterans must also verify that they used the property at some point as a primary residence. More qualification criteria can apply based on individual mortgage companies.

Help with Streamline Refinancing VA Loan Programs In MA

Homeowners with VA loans can use their existing loan company or use a different one. Many financing companies are VA approved and can help with streamline refinancing. The above details are shared only as an overview. This information is considered accurate but is not guaranteed. It was prepared based on information available at the time the article was written and is subject to change without notice. Always speak with a local loan officer for up-to-date information and help. To be directed to a local bank providing streamline refinancing VA loan programs in MA, contact Peter DaMore at Law Offices of Peter T. DaMore Jr. at 781-229-7900 or pdamore@ptdlaw.com.

Reverse mortgages could be beneficial in certain circumstances. It is important to get all the facts before getting a reverse mortgage. This blog offers details on reverse mortgages for MA homes.

Reverse Mortgage Overview

A reverse mortgage is a special type of home loan that allows you to convert a part of the equity in your property into cash. However, unlike traditional equity loans, borrowers are not required to make monthly payments towards the loan. Repayment is delayed until the homeowners no longer use the property as a principal residence or fail to comply with the requirements of the mortgage. The amount paid back includes the equity taken out, interest on the loan, and other applicable fees.

Who Qualifies for Reverse Mortgages

Not every home owner can use a reverse mortgage. You must…

• Be at least 62 years old.
• Own a home that you live in as a primary residence.
• Have a qualifying property type.
• Have equity in the real estate.
• Participate in a reverse mortgage counseling session.

How Much Can You Borrow?

The amount of a reverse mortgage is based on the age of the borrower, the current interest rates, the appraised value of the home, and FHA mortgage insurance limits. Older borrowers are allowed to extract a higher amount equity. Cash can be received as a lump sum, a fixed amount each month, or through a credit line.

Additional Details On Reverse Mortgages For MA Homes

Reverse mortgage programs are completed by most mortgage companies. Closing charges are high, so it should only be used when no other mortgage programs are feasible. Program specifics and fees can differ, so be sure to obtain estimates from a few different mortgage providers before making a decision. The details on reverse mortgages for MA homes provided above is intended simply as an overview. Program terms may vary, so contact reverse mortgage experts for advice based on your situation.

Individuals selling one property and buying (or building) another may face challenges with coordinating both events, especially in competitive environments. Bridge loans can be a useful solution to this dilemma. The information below on MA bridge loans – how bridge loans work will assist you with understanding this financing alternative.

MA Bridge Loans – How Bridge Loans Work

Many sellers have equity in their existing real estate. There may be a gap in the date those funds are available if a new home must be closed before the old real estate sells. Bridge loans are temporary loans that bridge that gap. It is a substitute for home equity loans (since many lenders do not approve home equity loans for properties on the market).

The underwriting process and criteria for bridge loans will be very different from typical mortgages. Because bridge loans are short-term, they are not normally submitted to the secondary market and therefore need not use the same standards. Minimum credit scores, debt-to-income ratios, and other qualifying factors may range among lenders. During the life of the bridge loan, the homeowner will essentially have two mortgages (one on the hoem listed for sale and one on the new property). Therefore, the borrower must be able to afford both.

Weighing the Pros & Cons of Bridge Loans

Bridge loans allow homeowners to buy and list without the use contingencies on both transactions and scheduling simultaneous closings. This can usually result in additional negotiation ability or facilitate transactions that can otherwise fall apart. It also makes the packing and moving coordination less cumbersome by removing the need for interim storage in same-day closing scenarios. On the other hand, not all borrowers qualify for bridge financing. They also have more fees than home equity financing. Individuals should evaluate these factors with the assistance of both real estate professionals and loan officers.

The First Step

Whether you should obtain a bridge loan is dependent on your financial and real estate goals. A local mortgage company that provides bridge loans can offer more comprehensive information beyond the MA bridge loans – how bridge loans work shown above.

MassHousing is a not for profit public agency in Massachusetts that provides financing. They do not use taxpayer dollars and are a self-supporting agency. Home buyers should consider a MassHousing loan as it may be more economical than an FHA loan. It may be applied towards a purchase or refinance of a single family, condo, or multi-family (2, 3, or 4 family) that a buyer intends to use as a primary residence. Below is more information on MassHousing programs for Burlington MA home buyers.

MassHousing Loan Amounts and Limits

Under MassHousing, loan amounts up to 97% of the purchase price are allowed on single family homes and condos, and up to 95% on multi-family properties. FannieMae loan limits also apply and can be reviewed at the Fannie Mae website. For single family and condo purchases, no buyer contribution is needed. This means that borrowers can obtain the funds for the closing as a gift from a family member or via credits from a party in the transaction (i.e. the seller). Multi-family properties require home buyers to contribute 3% of their personal money, confirmed through bank statements or other financial paperwork. The remainder of the the down payment and closing costs can be covered by gifts or credits. Lastly, there are income limits which differ by city and property type.

Mortgage Insurance Amounts

Mortgage Insurance Introduction

Mortgage insurance is normally required on loans for more than 80% of the purchase price. It is often charged as a large up-front premium paid at closing and monthly payments (based on a percentage of the loan). When this blog was published, the FHA mortgage insurance premium was 1.15% of the mortgage. On a $200,000 home with 3% down payment, the cost would be $1,930 up-front and $186/month.

MassHousing Option with NO Mortgage Insurance

Interest rates on MassHousing loans are traditionally a little bit higher than FHA, however, the mortgage insurance amounts are less. MassHousing actually offers mortgage options with or without mortgage insurance. The program with mortgage insurance has no up-front fee and a lower monthly rate. When this article was prepared, the premium was 0.60%. For the same $200,000 home mentioned above, the monthly amount would be $97 (as opposed to $186 through FHA). A person using MassHousing would save money over FHA even with a slightly higher interest rate. The savings are even greater with the MassHousing no mortgage insurance option.

Benefits of MassHousing Programs For Burlington MA Home Buyers

MassHousing programs are an economical alternative for real estate buyers in Massachusetts who qualify. Similar to FHA, it accommodates low down payments but with lower mortgage insurance premiums. It can be used on single family, condo, and multi-family real estate (with up to 4 units). Interest rates remain the same for a 30-year repayment period, ensuring unchanging mortgage payments for home buyers. The MassHousing Programs For Burlington MA Home Buyers above is provided as an introduction and is based on facts available at the time this article was written. Terms and other details may be adjusted by MassHousing at any time. For a list of reputable providers of for Burlington MA home buyers, contact Peter DaMore with Law Offices of Peter T. DaMore Jr., at 781-229-7900 or pdamore@ptdlaw.com.

It is useful to find out components of Massachusetts recurring mortgage payments to properly estimate home ownership costs. The acronym PITI is commonly used to remember the items included, which are principal, interest, taxes, and insurance. Not all loan payments will include all of these items. It will differ based on your specific loan.

Components Of Recurring Mortgage Payments

Principal Contributions

Principal is essentially the balance of the loan. For most loans, a portion of your mortgage payment every month is allocated towards reducing the balance, although there can be exceptions to this such as interest only loans. In the first several years of paying a loan, very little of the payment actually goes towards principal, but this increases over time.

Loan Interest

Interest is the amount billed by lenders for use of their money. The interest rate is always a yearly rate but billed monthly according to the balance of the loan. Depending on your type of loan, the rate can stay the same for the entire life of the mortgage or it can fluctuate at specific periods of time.

Municipal Taxes

Taxes are levied by Massachusetts according to the assessed value of real estate. The amounts are quoted annually but often due in installments. Overdue taxes become a lien on a property and supersede mortgage liens. Many banks will, therefore, ask homeowners to set aside funds into an escrow account to guarantee that the bills are paid. Those funds are collected monthly by the lender as part of the regular monthly payment. The lender then pays the taxes directly rather than waiting for the borrower to do so. It is a method of protecting their interests in a property.

Insurance

There are different types of insurance that can apply to a mortgage. Hazard is typically mandated and mortgage insurance varies based on the specific loan. Both may be part of monthly loan payments.

Hazard insurance protects against damages. Lenders require this insurance since the home is collateral on the loan. Insurance premiums are payable yearly and many will want funds be put into escrow (similar to tax escrow). They will then submit payments to the insurance company directly to ensure the policy remains active.

Mortgage insurance is common for mortgages higher than eighty percent of the property value or sale price. It protects the mortgage company should a homeowner stop making payments. Lenders expect that they will not recover the full balance owed if it forecloses, so the mortgage insurance covers some of their loss. Although it protects the mortgage company, the borrower can be responsible for the payments.

Knowing Massachusetts Recurring Mortgage Payments

Not all financing is structured the same and therefore not all Massachusetts recurring mortgage payments will include all of the items above. There can also be other monthly expenses such as condo fees, which are not escrowed by mortgage companies but are a significant factor in calculating total monthly home cost. Remember that exact amounts are based on a specific home and interest rate, so any preliminary estimates will likely change.

The Consumer Financial Protection Bureau is responsible for administering and imposing regulations pertaining to finances. The Real Estate Settlement Procedures Act (RESPA) is a federal regulation that distinctly concerns property and mortgage transactions, including mortgages. One of the rules by RESPA is the stipulation that a Good Faith Estimate (GFE) be sent to all parties who apply for a mortgage. This article offers facts on lender good faith estimates for Burlington MA home buyers.

Good Faith Estimate Definition

A Good Faith Estimate includes closing costs, loan percentages, and additional charges associated with getting a mortgage from a certain lender. It is meant to permit home buyers to analyze programs offered by individual mortgage companies and to outline the overall charges involved with obtaining a loan. Mortgage companies are obligated to provide a Good Faith Estimate within 3 days of a mortgage application.

Variations In Good Faith Estimates

Certain fees in GFEs are administered individually by a lender while others (such as filing costs) are set by districts where the paperwork is filed. Lender controlled items, such as underwriting charges, vary from one lender to another and reviewing GFEs is how you will notice those variations. Remember that a GFE is just an estimate based on information available at the time of the loan application. Some items may not increase, some may change by a limited percentage, and others can be based on your purchase price or other factors. Ask your lender about which charges can increase or decrease if you are worried about the final figures.

Understanding Lender Good Faith Estimates For Burlington MA Home Buyers

Although GFE templates have been amended in recent years, it may still be a little difficult to comprehend. Ask your mortgage professional or legal professional to explain the figures in the GFE and ensure that you understand it before moving forward with a particular mortgage.