Get pre-approved for a mortgage quickly

This is a bit annoying, since you’ll need to organize and share a lot of financial paperwork, but getting pre-approved for a mortgage early on will give you a clear idea of how much you can really afford. Having your financing in order early in the process can also make you a more attractive buyer to sellers since there are fewer ways the offer can fall though.

Compare lenders

All mortgages and all lenders are not the same. Check online reviews, both for the company and the specific mortgage loan officer you’ll work with. The giant Zillow Home Loans, for example, has 5-star and 1-star experiences. You can also confirm with the Better Business Bureau.

Compare the interest rates offered by different possible lenders, although you can always refinance in the future if you discover a better situation. Also, there may be fees or extra closing costs associated with the loan. So it’s usually a good idea to compare different offers from different lenders before making such a big decision. Even if you end up with the original one, you’ll know you’re getting what you want.

Be aware of extra costs

The down payment is not the only thing you’ll need to pay. In Massachusetts, the closing costs can be extremely high. Unlike choosing a lender, homebuyers don’t have a lot of options here, as most of the closing costs are mandatory and non-negotiable.

Homebuyers will also need to pay for property taxes and home owners insurance, not to even mention any costs of repairs, repainting, or moving in.

Plan long-term

One way to make a long-term plan is to take on a 30-year mortgage, while making plans to pay it off more quickly. Maybe even pay it off in 15 years?

Homeowners can make extra payments on their loan or overpay on their monthly payments, and put the overpayment towards the principal of the loan. This lets the new homeowners have the lower mandatory payments of the 30-year loan, just in case, but by paying more towards the principal on a regular basic, the mortgage period can be much shorter. This mortgage repayment calculator will let you estimate your financial changes with mortgage overpayment. 

Expect a competitive market

Boston has always had a pretty high demand for housing, especially in really desirable neighborhoods. Covid has changed that and increased demand even more. You see that happening almost everywhere, not just here in Boston. Buyers making offers over the asking price, buyers offering cash, and even buyers getting into bidding wars are all happening much more frequently with the increased demand.

This Boston Globe article explains how many first-time homeowners are giving up on trying to find and buy a home in Boston due to the hypercompetitive housing market. Instead, many people decide to rent another year or to leave the city entirely.  Bloomberg reports that New England properties are very popular, especially in rural areas.

This increased demand is also intense in property outside the city. With more remote work options, many people are able to keep their city jobs and higher income while living a more rural life. Also, with so much more time at home due to the pandemic, many families are prioritizing more space, especially green space, at home. This creates a serious increase in demand for suburban and rural properties.