2021 Massachusetts first-time homebuyer assistance programs

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As is the case in most parts of the country, first-time homebuyers in Massachusetts are finding themselves in a seller’s market. In keeping with the national trend, home prices have been on the rise in the state, with the median single-family price up more than 14 percent over last year, according to market research firm The Warren Group.

The good news? Even with prices climbing, first-time buyers in Massachusetts have access to low-interest loans and other programs that can help make homeownership more affordable. There are options available through MassHousing, as well as the nonprofit Massachusetts Housing Partnership.

Massachusetts first-time homebuyer loan programs

MassHousing Mortgage

Well-suited to first-time homebuyers, MassHousing offers a fixed-rate mortgage featuring MI Plus, a type of mortgage payment protection that covers the mortgage principal and interest in the event of a job loss. MI Plus covers payments for as long as six months, and up to $2,000 per month.

Borrower requirements:

  • Must meet credit and other eligibility requirements as determined by mortgage lender
  • Must complete homebuyer education course
  • Must meet MassHousing income limits
  • Must work with an approved lender

Property requirements:

  • Must be a single- to four-family home, or condominium

MassHousing Purchase and Renovation Loan

If you’re buying a home in need of repairs, MassHousing offers a rehabilitation loan option for financing both the purchase of the home and renovation costs in a single mortgage. The borrower can finance up to 75 percent of the home’s “as completed” appraised value for the renovation expense.

Borrower requirements:

  • Must meet credit and other eligibility requirements as determined by mortgage lender
  • Amount borrowed for renovations must be at least $10,000, and includes the cost of the renovation itself, inspection and title fees and a contingency reserve (10 percent of total reno cost)
  • Must meet MassHousing income limits

Property requirements:

  • Must be a single- to four-family home

MassHousing Operation Welcome Home

MassHousing’s Operation Welcome Home program offers a fixed-rate mortgage to first-time homebuyer military members and veterans. (The first-time buyer requirement doesn’t apply to military members and veterans buying in Boston and other select markets.) Along with the mortgage, the program offers closing cost assistance up to $2,500, which can be combined with MassHousing down payment assistance. In order to qualify, borrowers must be a member of the National Guard or Reserves, active-duty military, veteran or Gold Star family member, and also meet income limits and other eligibility requirements.

Massachusetts Housing Partnership ONE Mortgage

The Massachusetts Housing Partnership (MHP) offers a 30-year fixed-rate loan, the ONE Mortgage, for low- and moderate-income first-time homebuyers. There is no private mortgage insurance requirement for this loan, and extra assistance is available to help lower the borrower’s monthly payments.

Borrower requirements:

  • 3 percent down payment for a single- or two-family home or condominium; 5 percent down payment for a three-family home
  • 640 minimum credit score for single-family home or condo; 660 minimum credit score for two- or three-family home
  • Maximum 38 percent debt-to-income ratio (exceptions up to 43 percent in some cases)
  • Assets can’t exceed $75,000, excluding college or retirement savings
  • Must complete homebuyer education courses
  • Must meet MHP income limits

Property requirements:

  • Must be primary residence
  • Must be a single- to three-family home, or condominium

Massachusetts down payment assistance

MassHousing Down Payment Assistance program

MassHousing provides first-time homebuyers with down payment assistance (DPA) for up to $15,000 or 5 percent of the home’s purchase price, whichever is less. The assistance comes in the form of a 15-year, fixed-rate loan with an interest rate of 2 percent. The loan must be repaid when the home is sold or the loan is refinanced.

Borrower requirements:

  • Must meet MassHousing income limits unless buying in Boston or one of several other “Gateway Cities” (including Lowell, Springfield and Worcester), where borrowers can earn up to 135 percent of the area median income (AMI) and still be eligible

Property requirements:

  • Must be a single- to four-family home, or condominium

MassHousing Workforce Advantage 2.0

MassHousing’s Workforce Advantage 2.0 program offers up to $25,000 in down payment assistance to first-time homebuyers. Through the program, buyers receive a fixed-rate MassHousing Mortgage (with MI Plus protection) and a down payment assistance loan with zero-percent interest. The payments on the DPA loan are deferred until you sell or transfer ownership of the home, or pay off or refinance the first mortgage.

Borrower requirements:

  • Can earn up to 80 percent of area median income (AMI)

Property requirements:

  • Must be a single- or two-family home, or condominium

Other first-time homebuyer loan programs

In addition to MassHousing and Massachusetts Housing Partnership programs and assistance, first-time homebuyers can also take advantage of FHA, VA and USDA loans, which offer terms and rates that can make it easier to purchase a home. Bankrate’s first-time homebuyer loans and programs guide can give you a rundown of these and other options.

For other Massachusetts homeownership programs, including by city, visit HUD.gov.

Get started

MassHousing works with over 150 mortgage lenders in the state. MHP also maintains a list of participating lenders offering the ONE Mortgage. Keep in mind that lender requirements and interest rates in Massachusetts vary, so it’s important to compare options and fees before you commit to a loan offer.

Nearby states first-time homebuyer programs

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Written by
Autumn Cafiero Giusti
Contributing writer
Autumn Cafiero Giusti is an award-winning journalist with over two decades of professional experience. She writes about mortgages, real estate and banking.
Edited by
Mortgage editor