Mortgage basics.

A preapproval clarifies your price range and strengthens an offer. A lender reviews your income, debts, credit, and assets, then issues a written letter stating the amount it is prepared to lend. Sellers take these offers more seriously, and many Massachusetts listings expect a preapproval letter with every offer. Compare loan estimates from more than one lender — rates, fees, and service genuinely differ — and get the letter updated before you make an offer if some time has passed.

Underwriting comes down to four things: your credit score and history, your debt compared with your income (the debt-to-income ratio), your down payment and cash reserves, and the property itself — its appraisal and, for two- and three-families, whether the rental income is documented. A lender’s maximum approval can exceed what fits your life comfortably, so set your own budget first and treat the approval number as a ceiling, not a target.

Conventional loans often start at 3–5% down, and FHA at 3.5%, so buying does not require twenty percent. The tradeoff is mortgage insurance: conventional loans add private mortgage insurance (PMI) below 20% down — it can be removed later as your equity grows — while FHA loans carry their own mortgage insurance premium with different rules for getting rid of it. Ask each lender to show the payment both with a smaller down payment and with more money down, so you can see exactly what the difference buys you.

Most buyers compare four: conventional loans (backed by Fannie Mae or Freddie Mac), FHA loans (flexible credit rules, popular with first-time buyers), VA loans (for eligible veterans, service members, and some surviving spouses, often with no down payment), and USDA loans (for eligible rural areas — most of Brockton does not qualify). Massachusetts buyers also have state options below. Ask for a Loan Estimate from each program you qualify for; the three-page form makes rate, fees, and cash-to-close easy to compare side by side.

The rate you are quoted depends on the market, your credit, the loan type, and what you pay up front. Discount points let you buy the rate down — one point costs one percent of the loan amount — which can make sense if you will keep the loan a long time. A rate lock holds your quoted rate for a set window, typically 30 to 60 days; ask what happens if your closing slips past the lock, and whether the lender offers a float-down if rates fall before you close.

Principal and interest are only the start. Most Massachusetts loans also escrow property taxes and homeowners insurance, so the lender collects a fraction of each bill monthly and pays it for you — which means your payment moves when the city resets the tax rate or your insurance renews. Add any mortgage insurance, association fees for condos, and separate flood coverage if the map requires it. Use the mortgage calculator on this site to model the principal and interest, then layer in the property-specific costs.

Budget roughly 2–5% of the purchase price beyond the down payment. In Massachusetts that includes attorney fees, the lender’s origination and underwriting charges, the appraisal and title work, pre-paid taxes and insurance escrows, and recording fees at the registry of deeds. You receive the Closing Disclosure at least three business days before closing — compare it line by line against your Loan Estimate and question anything that moved. Sellers can sometimes be negotiated to contribute toward your closing costs; ask KC what is realistic in the current market.

Owner-occupied two- and three-family homes are common in Brockton, and they can qualify for residential financing when you live in one of the units. Ask lenders how projected rental income is treated — many will count a portion of documented market rent toward your qualifying income, but they will want leases, rent records, or an appraiser’s rent schedule, and some programs cap the loan amount or add pricing adjustments for three-families. Verify legal units and registrations before counting on income from a unit.

MassHousing offers fixed-rate mortgages with down payment assistance for eligible first-time buyers, and MHP’s ONE Mortgage serves income-eligible buyers with low down payments and no mortgage insurance. Some buyers also qualify for a mortgage credit certificate or city-level assistance. Eligibility, income limits, homebuyer education, and funding availability all change, so confirm the current rules with an approved lender before you rely on assistance — and start early, because some programs require completing a class before you make an offer.