Home Buying in Chelmsford>Question Details

Ellie, Home Buyer in Chelmsford, MA

We are first time home buyers. If we are buying a house in the $290,000 to $325,000 how much of a down payment do we need?

Asked by Ellie, Chelmsford, MA Sun Aug 15, 2010

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Depends on your financing product. FHA type loans are riskier loans (in the eyes of the seller) which can effect negotiating so the more you can put down the better position you will be in to negotiate.

Speak with a mortgage broker or bank prior to searching for real estate. It will help you manage expectations. This way you wont get your heart set on a property only to find out you cant afford to own it.

http://territoryre.com
Web Reference: http://territoryre.com
1 vote Thank Flag Link Thu Aug 19, 2010
Hi Ellie,
You really need to sit down with a Mortgage Professional to investigate what programs are out there and which ones you would qualify for. If you don't have a mortgage professional in your network, you should hire a Buyer's Agent who should have a few lender's that they trust and can refer to you. I put a sight together specifically for first time home buyers to explain the entire process and it has some tools that will help you to understand what you want before you start the hiring process. I hope it helps http://8stepstohome.webs.com/
1 vote Thank Flag Link Sun Aug 15, 2010
Hi Ellie,

It depends on the loan program you qualify for. For example, FHA requires a 3.5 percent down payment, i.e., $10,500 on a $300,000 home. MassHousing (http://www.masshousing.com) has programs with 0 percent, 3 percent and 5 percent down payments, but your credit score must be excellent to qualify for a 0 down loan. MassHousing also has income limitations, but you can make a lot more money than you might think and still qualify.

Many lenders will steer you to FHA; however, FHA has an upfront mortgage insurance requirement that adds thousands of dollars to your closing costs. This amount is rolled in to the loan, but it still makes buying more expensive. FHA is a good product, if you have a low credit score.

If you qualify, MassHousing is a much better deal.

Of course, if you have more than 5 percent to use as a down payment and you have a good credit score, you'll have other options.

I certainly can provide you with a referral to a lender that handles MassHousing loans (not all lenders do), if you'd like. I am also an exclusive buyer agent that has helped many first-time home buyers purchase in Chelmsford and the surrounding areas. I'd be happy to answer any other questions you might have.
1 vote Thank Flag Link Sun Aug 15, 2010
Ellie:

I was in Chelmsford showing homes yesterday and there are 32 homes for sale in your price point. What a great time to be a buyer client. Have you selected a buyers agent? I would love the opportunity to interview for your business. Best
0 votes Thank Flag Link Sun Aug 22, 2010
As mentioned, down payments can range from 0% for Mass Housing, USDA and VA loans, 3.5% for FHA loans and up. More important is to determine the affordability of the home so that you'll have an idea of not only the principal and interest payments but payments for real estate taxes and homeowners' insurance as well as for any other debt you currently pay monthly.

I would suggest obtaining a mortgage loan preapproval to determine the loan programss (and hence the amount of down payment) forw which you would qualify and could afford. I would be happy to help with that or there are many other lenders you could contact.

Happy Househunting!
0 votes Thank Flag Link Tue Aug 17, 2010
Ellie:

If you are using FHA you can put 3.5% down which in this range is about $10,500.00. There are some other costs involved with this loan, but it is a great way to get into a home. If you have not selected a buyers agent, I wanted to let you know that my partner and I offer a free 1 hr consultation and we discuss soup to nut all that involved in buying a home. I live in Maynard and grew up in Acton and am very familiar with the area. Best
0 votes Thank Flag Link Mon Aug 16, 2010
Because this is HUGE as far as the proper answer I suggest you call this company:
NEW FED MORTGAGE - they literally specialize in all mortgage type and have a great reputation.
I costs nothing to call and get the full facts and find a mortgage that best suits you and the wisest amount to put down. It cannot hurt and they have never disappointed me. Give it a go 978-590-2442 - The branch managers name is Mike Bornstein. I get nothing out of this- its just the best place for answers in my experience.

Good luck - and if you need me for anything - I always answer the phone 978-335-9092 - J
0 votes Thank Flag Link Sun Aug 15, 2010
The link below has a list of several different mortgage calculators that might be helpful as you evaluate your options in financing.
http://www.mtgprofessor.com/calculators.htm
0 votes Thank Flag Link Sun Aug 15, 2010
Deborah Madey, Real Estate Pro in Brick, NJ
MVP'08
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Hi Ellie,

The agents that have responded already are correct. Your downpayment amount it going to depend on which financing program you use. I notice that you are in Chelmsford MA. I know of quite a few lenders in the area that would be happy to sit down with you and discuss your options. In this market, it's very important to get pre-approved for a mortgage prior to looking at houses. That way, you know exactly what you can afford. Also, Seller's are going to want to know that you are pre-approved prior to signing and accepting an offer that you've submitted.

Let me know if I can help in any way.

Catherine Condon, Broker MA & NH
(978)433-0000
Web Reference: http://www.integrity-rb.com
0 votes Thank Flag Link Sun Aug 15, 2010
Ellie, There are programs out there that can range from 0%, 3.5%, 5% and up. Depends on your credit score, income, veteran status and some other factor. The Mass Housing Authority and VA have 100% programs. There may be others too. Check with a local lender first. They usually have access to all the national and State programs. Then you may want to compare rates with a national bank for rate comparison. Be careful not to have too many institutions pull your credit. You should only have the one you decide to use do that.
0 votes Thank Flag Link Sun Aug 15, 2010
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