Massachusetts Home Buyer Guide

Many real estate industry professionals have recently expressed concern that rising mortgage interest rates would slow the real estate recovery around the United States. There's one problem with that theory: Mortgage interest rates have declined slightly over the last couple of weeks. 

The average interest rate for 30-year, fixed-rate home loans in the United States declined to 4.32 percent this week, the Detroit Free Press reported September 26, 2013. Freddie Mac provided the data.

With average U.S. 30-year mortgage interest rates more than 1 percent higher than average rates in May, sales of new construction homes across the nation declined 13.4 percent in July 2013 compared to June 2013, Yahoo! Finance reported August 23, 2013.

Sales of newly built homes stood at a seasonally adjusted rate of 394,000 in July, according to U.S. Commerce Department data. July's sales numbers for new homes were the lowest in nine months, as sales fell from a rate of 455,000 in June. The June numbers were revised down from a previously reported 497,000 sales. 

Higher mortgage interest rates over the past couple of months may have discouraged some home buyers from seeking a mortgage loan, but that doesn't mean lenders are just going to stand by make less money. 

The following are brief summaries of the latest real estate news in Massachusetts and around the United States to keep home buyers informed. 

A couple of weeks ago two Buyers Brokers Only, LLC home buyers closed on Massachusetts homes on consecutive days with fixed, 30-year mortgage interest rates of less than 3.5 percent. One couple were first-time home buyers and the other couple were moving to a newer, more modern, home.

Mortgage interest rates may not be that low again in their lifetime; however, not everyone thinks it is a bad thing for the real estate market, especially hot markets, such as in Greater Boston, where home prices have been rapidly rising over the past year and real estate inventory is tight.  

MA Governor Deval Patrick is asking local banks to participate in an initiative that would provide 10,000 mortgages over the next five years to Massachusetts first-time home buyers, several media outlets reported June 10, 2013. 

Called the Massachusetts Housing Ownership Compact, the plan is for local banks to provide mortgages loans for home buyers with household incomes that fall below the median income in their geographical areas, Boston.com reported. 

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. 

In an effort to help affordable housing owners reduce costs and make their properties more energy efficient, the Massachusetts Housing Partnership (MHP) announced January 18, 2013 a new loan program to help its borrowers make energy improvements in their homes.

Homeowners aren't the only people to benefit from a tax break for forgiven mortgage debt that was set to expire December 31, 2012, but was extended by Congress and President Obama when they narrowly averted the “fiscal cliff” crisis.

Massachusetts home buyers, and home buyers around the country, still have super low mortgage interest rates available to them for the purchase of a home. 

After three straight weeks of declines, the Mortgage Bankers Association (MBA) reported last week that U.S. mortgage applications increased 11.7 percent.