Mortgage Options

Fixed vs. Variable

The simple fact is, choosing the right mortgage for your situation and budget is one of the most critical decisions you have to make. Do you choose a fixed-rate mortgage that offers fixed monthly payments? Or an adjustable-rate mortgage that offers lower payments in the early years. It pays to do your homework.

Before you decide, there are a few important questions you need to ask:

•  How long will you be in your new home?
•  Will this be the last house you live in?
•  Do you expect your income to rise?
•  What is the current interest rate environment?

As a general rule, a fixed-rate mortgage is ideal if you plan to live in your home for a longer period.

 With a fixed-rate mortgage, you'll:

•  Lock in a fixed interest rate for a fixed number of years, usually 15, 20, or 30 years, no matter what happens in the market.
•  Know exactly how much you owe each month, making budgeting easier.
•  The benefit of a fixed-rate mortgage: The predictability of fixed monthly payments.

If you plan to live in your home for a shorter period of time, usually seven years or less, an adjustable rate (variable) mortgage may be the right choice. With an adjustable-rate mortgage, you'll lock in a fixed rate for a certain number of years and then each year after, your rate will adjust annually. 

With an adjustable-rate mortgage, you will:

•  Keep your payments lower in the early years when your income is lower.
•  Be able to qualify for more money and potentially get a bigger home.
•  Be protected by interest rate caps, which limit how much your rate can increase by in a given adjustment period.
•  The benefit of an adjustable-rate mortgage: Flexibility.

Metro offers a variety of mortgage programs for you to choose from.  Two popular options for first time homebuyers and those with low to moderate income include FHA and MassHousing mortgages.

FHA

A popular loan program among homebuyers with a limited down payment and for those looking to purchase their first home. Here are some of the benefits of an FHA mortgage:

•  1-4 unit properties with as little as 3.50% down payment
•  2% of loan amount cash back credit at closing*
•  Less stringent qualification
•  No income limitations

MassHousing

MassHousing mortgage is a program for moderate income borrowers. Benefits of the MassHousing Program include:

•  Up to 97% financing for single family homes and condos
•  95% financing on 2-4 families
•  30 year fixed-rate loans
•  Purchase and refinance available
•  Choose with or without mortgage insurance
•  Mortgage loan and income limits apply

*Subject to underwriting qualifying allowable lender credit at closing.  Available for single-family, condo, and 2-4 unit owner occupied residences.  Minimum loan amount is $50,000.  Homeowners insurance required and flood insurance where necessary. 

Subject to credit approval.  Available for residences located in MA or southern NH. NMLS# 198524.