Massachusetts Home Buyer Guide

First-time home buyers in Massachusetts and around the country will want to speed up their home search, if they plan to finance the purchase of a home with a Federal Housing Administration (FHA) loan. 

FHA announced recently that fee increases and underwriting rules for FHA loans will increase the cost of homeownership for first-time and other borrowers. FHA loans are especially popular with first-time home buyers because the minimum down payment required is 3.5 percent, as opposed to 5 percent to 20 percent or more for conventional loans. In addition, FHA will lend to home buyers with credit scores a little lower than scores acceptable to lenders of conventional loans. 

Massachusetts home buyers and home buyers around the United States still have the opportunity to take advantage of historically low mortgage interest rates. In fact, interest rates are a bit lower than they were a few weeks ago.  

The average rate for a 30-year, fixed rate mortgage loan in the U.S. declined .07 points last week to 3.70 percent, the lowest level in more than a month, the Mortgage Bankers Association (MBA) reported March 6, 2013. 

A federal fund used to support the Federal Housing Administration's (FHA) single-family mortgage and reverse mortgage insurance programs ended fiscal year 2012 with a $16.3 billion deficit, according to an annual report submitted to the United States Congress this month, Inman News reported November 16, 2012.