If you are considering buying a home, or refinancing your current mortgage, consider a number of factors. Do not sign any contract until you have thoroughly read and understood all of its provisions, notices and terms. Have a trusted advisor, such as an attorney, review your loan documents and explain any language that may be confusing or unclear. Ask questions when considering which type of mortgage may be right for you. Questions such as:
  • What will my monthly payment be?
  • Can my monthly payments increase? How much could my monthly payment increase?
  • Under what circumstances could my payments increase (i.e., such as late payments)?
  • Will rates go up after specific periods of time?
  • Will I have to pay a penalty if I sell or refinance my house? How much would that be?

Review your financial ability to afford a house. Do you have sufficient savings in an emergency fund to help supplement your family income in the event of a job loss or illness? Do you have the resources to handle a major home repair if needed? Should you consider a less expensive home or should you defer buying a home until you can save a little more money? If you are unsure of the answers or need assistance determining your ability, counseling services for first time homebuyers may be available in your community. Several state, federal and nonprofit programs are available to provide assistance to prospective homebuyers.

 

Citizens Housing and Planning Association

The Massachusetts Homeownership Collaborative is an initiative managed by the Citizens' Housing and Planning Association (CHAPA) that supports and promotes homebuyer education. These agencies offer homebuyer education workshops and individual homebuyer counseling to prospective homebuyers.

 

Mortgage Bankers Association

The Home Loan Learning Center website, sponsored by the Mortgage Bankers Association, provides step-by-step information on how to become financially literate. Learn about credit reports and scores, the true cost of owning a home, and how to compare the costs of owning versus renting a home. The website provides in-depth, easy-to-read home loan product information in the Mortgage Basics section, which includes information on how to qualify for a loan, what the documents mean, what's in the mortgage payment, and mortgage calculators to help consumers plan their payments.

 

Fannie Mae

Fannie Mae is a Government Sponsored Enterprise (GSE) that sponsors the HomePath program, which is designed to help homeowners and homebuyers find the Fannie Mae mortgage and lender that is right for them. Fannie Mae has developed a large array of innovative mortgage products, available through a nationwide network of Fannie Mae-approved lenders. While Fannie Mae doesn't lend money directly to borrowers, the HomePath programs provides a number of useful information and tools, such as loan modification and refinance guides, payment calculators, a glossary of terms, and a list of organizations that provide counseling and a list of mortgage lenders.

 

Freddie Mac

Freddie Mac is a GSE and provides an About Homeownership section on its website, which includes an online guide to the home buying process in English and Spanish, financial calculators and tools, and a list of properties for sale.