Tips for Qualifying for a Boston Home Loan

If you’re considering buying a home in Boston; now is a great time to do so! With the spring market underway, there are new homes budding onto the market each week! As a Boston Real Estate agent, I know the task of buying a home can seem daunting and exciting all at the same time. It’s important to be well educated on the current Boston Real Estate market and be well prepared before you begin your Boston home search.

You may have noticed, if you’ve already started researching the current housing market that 2011 has brought about a few changes in qualifying for a home loan. Due to the past few years and the downturn of the real estate market, lenders have tightened the reins on those who qualify for a home loan in hopes of continuing to heal the market. They want to maintain a watchful eye on those who are buying homes as opposed to a few years ago when the terms for qualifying were much more lax.

Now, before you get discouraged about the possibility of getting a home loan, there are a few key things you can do to help ensure you get the home loan you want! Before you even begin your home search; you’ll want to take a look at the following tips!

- Have the right credit score- Credit scores are moving to the forefront of being approved for a Boston home loan. Most lenders are expecting a credit score of 600+ even for FHA loans. A good credit score will not only help you qualify for a home loan, but can lower your interest rate, which can save you thousands of dollars in the long run.

- Shop around- The interest rate is important, but there are other costs to consider such as discount points and even the type of mortgage loan. When shopping for best rates, compare various combinations of discount points and loan types. Your Boston Real Estate agent can help you decide on the best option.

- Know your borrowing limit- If you’re not sure how much you want to borrow, a good rule of thumb is to look at the Federal Housing Administration requirements. FHA will limit mortgage payments at 31% of gross monthly income before taxes for most buyers. This can help ensure that you’re not getting in too far over your head. If we’ve learned anything over the past few years, it’s to play it safe in the housing market.

- Consider a No-Closing-Cost Loan- If you have positive equity, but are lower on cash up front, you do have an option to choose a no-closing cost loan. This simply means that you’ll have a slightly higher rate, but the closing costs will be paid over time instead of up front.

If you have any questions about qualifying for a Boston home loan or are interested in learning more about the Boston Real Estate market, please let me know! As a Boston Real Estate agent for over thirty years in various aspects of the real estate industry, I have great insight into the ins and outs of the home buying process as well as a thorough understanding of Boston! Please feel free to contact me today to begin your Boston home search!

Patti Fine
Phone: 617-642-7585
Email: pf@pattifine.com
Patti Fine Real Estate
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