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A new slice of first-time Massachusetts homebuyers can now access $25,000 in state assistance thanks to new state dollars flowing into a popular aid program.
The program offered through MassHousing is available for income-eligible first-time homebuyers who purchase a single-family home, condominium or a two-, three- or four-family property as their primary residence.
The money can be used for down payments, closing costs, permanent interest rate buydowns and up-front mortgage insurance premiums, MassHousing’s website says.
This program provides eligible buyers with up to $25,000 at 0 percent interest with deferred repayment terms. The program is available to first-time homebuyers who lock in their MassHousing mortgage between April 27 and July 31, and who earn up to 135 percent of area median income. That income limit equates to $205,335 in eastern Massachusetts, $165,645 in Worcester County, $137,565 in the Berkshires and $129,870 in Hampden County, Gov. Maura Healey’s office said.
Funding for the program comes from a $25 million allocation Healey announced in her State of the Commonwealth speech in January. Following that speech, Healey’s office said the money would help up to 1,000 households.
“This program lowers families’ upfront costs and their monthly payments so that more people can afford to buy a home and build their future right here in Massachusetts. Today, we’re bringing this assistance to a wider cross-section of the middle class who are being priced out of homeownership right now,” Healey said in a statement.
MassHousing expanded its down payment assistance program in June of last year to include residents in the five counties making up the Greater Boston area. Previously, the program was available statewide to new homebuyers earning under 80 percent of the area median income, while homebuyers earning more than 80 percent of the area median income could access down payment assistance only when buying a new home in one of the state’s 26 Gateway Cities, the city of Boston or the city of Randolph.
Prior to the $25 million allocated by the Healey administration, this assistance was offered in the form of a 15-year second mortgage with interest rates ranging from 2 to 3 percent, depending on household income.
“For many families, the biggest obstacle to buying a first home is saving enough for a down payment,” Housing and Livable Communities Secretary Juana Matias said in a statement provided by Healey’s office. “This expansion will help more Massachusetts residents become homeowners by tackling that barrier head-on.”
Over the past three years, MassHousing has provided Massachusetts residents with nearly $1.9 billion in mortgage funding and helped more than 5,500 households purchase a home, according to the governor’s office.
Calculations released by economists at listings portal Realtor.com in January say the typical Greater Boston resident must save for 20 years to build up the average down payment placed on a house in the region last year.
Banker & Tradesman staff writer James Sanna contributed to this report. This story has been updated with comments from Gov. Maura Healey and Housing and Livable Communities Secretary Juana Matias.
