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Massachusetts Home Buyer Guide

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What Massachusetts Home Buyers Need to Know About Days on the Market

Aug 5, 2014 8:30:00 PM

If homes are selling so fast, why were Massachusetts single-family homes on the market an average 89 days in June 2014, according to the Massachusetts Association of Realtors?

On the one hand, homes are not selling that fast in all Massachusetts cities and towns. On the other hand, many communities within 30 to 45 minutes of Boston are seeing homes in certain price ranges go under agreement is less then a week, but the way the number of days on the market is tracked gives the impression homes are on the market much longer. 

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Topics: Home-buying Tips, Real Estate Misc., Massachusetts Relocation

Loan Commitment Date Critical For Massachusetts Home Buyers

Jul 31, 2014 5:33:00 PM

Massachusetts homebuyers need to thoroughly understand the importance of the loan commitment date when purchasing a home and how failing to do so may result in the loss of their deposits.

The failure of a home buyer to receive a clean loan commitment letter, extend the loan commitment deadline or to terminate the contract with the seller before the loan commitment deadline passes puts him or her in jeopardy of losing deposits made at the time the offer to purchase and purchase and sale agreement were signed. For many home buyers, these deposits total 5 percent of the purchase price of the home they intend to purchase. 

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Topics: Home-buying Tips, Condominium, Mortgages 101, Real Estate Law

More Lenders For Massachusetts First-time Home Buyer Loan Programs

Jul 12, 2014 8:23:00 AM

The Boston Globe reported on July 9, 2014 that a few additional lenders have agreed to participate in a state program to provide loans to first-time home buyers through MassHousing and the Massachusetts Housing Partnership. What types of loans are available to first-time home buyers? Eligible first-time home buyers may qualify for mortgages with low down payments, no private mortgage insurance (PMI) and other benefits. 

The following are a few, but not all, of the loan programs available to first-time home buyers in Massachusetts

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Topics: Home-buying Tips, Mortgages 101, Loan Programs, Mortgage Rates & News

Massachusetts First-time Home Buyers Have a New Home Loan Product

Jun 8, 2014 1:35:00 PM

Massachusetts first-time home buyers now have an additional loan option when considering mortgages to purchase a single-family, condominium or multi-family home. 

MassHousing, a self-sustaining agency that does not use taxpayer money, announced on its blog May 20, 2014 a new lender-paid mortgage insurance (LMPI) program that increases a borrower's home-buying power. 

Through the program, the lender pays the full mortgage insurance premium for the borrower at the time of closing, which is good for the life of the loan. This cost is offset by a higher interest rate on the mortgage, compared to a loan with borrower-paid MI (BPMI). Even with the higher rate, the LPMI loan generally results in a lower monthly payment for the borrower for the first several years of the loan.

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Topics: Home-buying Tips, Loan Programs, Mortgage Rates & News

What MA Home Buyers Should Know About New Flood Insurance Rules

May 2, 2014 8:15:00 AM

Starting May 1, 2014, new rules for the National Flood Insurance Program went into effect. The North Shore Association of Realtors, located in Beverly, Massachusetts, provided its Realtor membership with the following information on the new flood insurance rules. 

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Topics: Home-buying Tips, Real Estate Misc., National Association of Realtors

When Should MA First-time Home Buyers Tell Landlords They're Leaving?

Mar 30, 2014 7:18:00 PM

Many Massachusetts first-time home buyers are renting an apartment at the time they decide to start looking to buy their first home, so the timing of their home search and when they notify their landlord that they are ending their tenancy is important.

Whether a home buyer has a written lease with a specific term or is a tenant at will, also referred to as a month-to-month tenant, will determine how to plan his or her home search and notify his or her landlord that he or she is leaving. First, it is important to understand the timing of different aspects of the home-buying process.

For example, a first-time home buyer should know that mortgages are paid in arrears. In other words, a mortgage payment made on April 1st is a payment for the month of March. Why is this mortgage fact important? It is important to understand that a real estate closing on April 15th will result in the home buyer owing his or her first mortgage payment on June 1st. If the home buyer's apartment lease ends on May 31st, an April closing will not result in owing a monthly rental payment and a monthly mortgage payment in the same month.

Home buyers should be aware that their lender, in the example above, will want the interest on the loan paid at closing for the remaining days of April (or whatever month the closing takes place in). Closing towards the end of a month will result in less interest owed at closing, but the first mortgage payment will be do sooner.

Also, homebuyers should check their records to see whether they paid last month's rent or provided a security deposit at the beginning of their rental term. Having already paid the last month's rent and/or a security deposit gives a first-time home buyer a little financial flexibility, including the ability to close sooner on a property or maybe have a rent-free and mortgage-free month. Tenants should know that Massachusetts law requires the landlord to return the security deposit, plus interest, within 30 days of the tenancy ending; however, the landlord may keep any unpaid rent or the amount of money needed to repair damage done to the apartment (beyond normal wear and tear).

If you're a tenant at will (no lease), you need to provide notice to your landlord 30 days or one month before the due date of the next rent payment, whichever is longer. For example, if you give your landlord notice on April 20th that you are leaving, you'll be responsible for the rent through May 31st.

Of course, it is impossible to know how long it will take to find a home you want to make an offer and get an accepted offer. Some home buyers see a hand full of homes before finding one and other home buyers see many more, so the process may take weeks or months.

Also, if you are breaking your lease prior to the agreed upon term, you may be responsible for paying rent for the remaining months in the lease term. Some leases will allow tenants to terminate a lease early, but will require the payment of two months rent as a penalty. It is important to carefully review your lease before making any decisions and notifying your landlord that you are leaving. 

In addition, any major repairs or renovations a home buyer wants to perform on a new home may need to be done prior to moving in, or a home buyer may just prefer to complete any remodeling jobs prior to leaving his or her rented apartment.

The Commonwealth of Massachusetts has a guide to landlord/tenant rights, and the City of Boston has a landlord/tenant guide.

Of course the ability to be flexible on the closing date of a home purchase gives home buyers a stronger negotiating position. With that said, it may be inevitable that a home buyer has to make a rent and a mortgage payment simultaneously for one or more months.

So when is it safe to tell your landlord you're leaving? Should you wait until the purchase and sale agreement (P&S) is signed, the loan commitment has been received or the closing has taken place? It all depends on your risk tolerance.

Home buyers give their landlords notice that they're leaving all the time before the closing occurs. Some people wait until the P&S is signed, others wait until the loan commitment is provided by the lender. Some home buyers want a sure thing, and they just wait until the closing happens and the deed is recorded.

There are countless things that can happen – some are pretty rare – that can derail the closing or push back the closing date after a seller accepts a home buyer's offer. First, there is the home inspection. It's probably a mistake to notify your landlord that you are moving out prior to the home inspection. 

Once the P&S is signed, the likelihood of closing increases; however, the loan commitment (the date by which your lender needs to provide you with  a letter assuring that you're receiving the loan) is subsequent to the signing of the P&S. Once your lender has provided a loan commitment, there is even a greater chance you will reach closing. After the loan commitment date is probably the most popular time for home buyers to notify a landlord of their intention of ending a tenancy. 

Are there other issues that can arise between the loan commitment date and closing? Sure, but most are pretty rare. Title issues are rare, but do occur, and title issues may kill the deal or delay a closing. Lenders typically recheck credit reports and conduct employment verification within a 72 hours of closing. A job loss or negative notation on a credit report could result in a home buyer not getting a home loan. It may make sense not to schedule a closing date to close to the date you must vacate your apartment, just in case the closing is delayed a few days.

Download the Quick Guide to the Massachusetts Home-buying Process

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Topics: Home-buying Tips, Real Estate Misc., Real Estate Law

Assessed Value v. Market Value: What MA Home Buyers Should Know?

Mar 11, 2014 7:10:00 PM

When buying a home, there are certain Massachusetts real estate terms that may be confusing or misleading to homebuyers, especially first-time homebuyers. Learning the terminology is important for a potential homebuyer to make an informed home-buying decision.

One common misconception among homebuyers is that the assessed value and market value of a house are the same, or have some sort of correlation. The fact is that assessed value has absolutely no correlation to market value. In order to understand the difference between the assessed value and market value of a home, it is important to know what the terms mean.

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Topics: Home-buying Tips, Real Estate Misc.

Massachusetts Home Buyer Tip: 'What Should I Offer?'

Mar 10, 2014 5:24:00 PM

What should I offer?

It's a good question whether the Massachusetts real estate market is a buyer's market or a seller's market. It's a good question whether a home buyer's price range is $200,000 or $800,000. Simply put, it's always a good and important question, but what's the answer? 

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Topics: Home-buying Tips

How Unmarried Home Buyers Hold Title to Real Estate in Massachusetts

Feb 15, 2014 5:20:00 PM

Obviously, not every home buyer that purchases real estate is married. Unmarried couples and friends, as well as relatives, have two choices on how they may hold title to real estate in Massachusetts. Married couples have another choice.  

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Topics: Home-buying Tips, Massachusetts Relocation, Real Estate Law, Boston Relocation

Massachusetts Home Buyers Should Stay Clear of Cupid's Arrows

Feb 14, 2014 7:53:00 AM

It's Valentine's Day, and we have seen the slick ads and pushy marketing for poetic greeting cards; delectable chocolates; bright red roses; and cute teddy bears promising true love and happiness. 

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Topics: Home-buying Tips

What Massachusetts Home Buyers Should Know About Radon Gas

Jan 17, 2014 8:16:00 PM

As part of a home inspection, home buyers may choose to have a radon test administered by the home inspector. Massachusetts home buyers should understand what radon gas is, how it is tested and what can be done to mitigate high levels of radon gas. 

What is Radon?

Radon is a naturally occurring radioactive gas that results from breakdown of radium and uranium in soil and rock. Because radon is a gas, it spreads out from the ground and into homes through foundation cracks and holes. It can move into any space that allows for air flow. Fieldstone foundations are more likely to have higher levels of radon, but cement is porous, so air can easily make its way through cinderblock and poured concrete foundations as well. Even new homes that are well-sealed and houses without basements can have elevated levels of radon. Radon can also be found in building materials, such as brick, stone or concrete.

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Topics: Home-buying Tips

2014 Resolutions for Massachusetts First-time Home Buyers

Jan 9, 2014 8:01:00 PM

A New Year's resolution is a promise that you make to yourself to start doing something good or stop doing something bad on the first day of the year.

The start of 2014 is a great opportunity for Massachusetts first-time home buyers to start making home-buying decisions that are in their best interest and resolve not to make bad home-buying choices just because other home buyers are doing it. 

Here are three resolutions for first-time home buyers in Massachusetts. 

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Topics: Home-buying Tips

   

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