Can You Buy a Home in Massachusetts With Less Than 20% Down?

Can You Buy a Home in Massachusetts With Less Than 20% Down?

The answer is YES! One of the biggest misconceptions about buying a home is that you need to save 20% of the purchase price before you can qualify for a mortgage.

For many potential homebuyers in Massachusetts, that belief can delay homeownership for years.

The good news? Several mortgage programs allow qualified buyers to purchase a home with as little as 3% or 3.5% down, while certain programs may even offer zero-down-payment options.

Whether you’re a first-time homebuyer in Boston, Worcester, Springfield, or another Massachusetts community, understanding your financing options could bring you closer to owning a home.

1. Why Do People Think They Need 20% Down?

Traditionally, a 20% down payment has been considered a desirable benchmark because it can help buyers:

• Avoid private mortgage insurance (PMI) on conventional loans.
• Reduce their monthly mortgage payments.
• Borrow less money.
• Build equity in their homes sooner.

However, 20% is not a universal mortgage requirement.

Many lenders offer financing options specifically designed for buyers who have steady incomes and qualifying credit but haven’t accumulated substantial savings.

2. Conventional Loans: Buy With as Little as 3% Down

Conventional mortgages are among the most common financing options available to homebuyers.

Certain conventional loan programs, including Fannie Mae HomeReady and Freddie Mac Home Possible, allow eligible buyers to purchase a property with a down payment as low as 3%.

For example, if you’re buying a $450,000 home in Massachusetts:

Down Payment	Amount Needed
3%	$13,500
5%	$22,500
10%	$45,000
20%	$90,000

That’s a significant difference!

Keep in mind that conventional loans with less than 20% down generally require private mortgage insurance. Eligibility also depends on credit, income, debt, property requirements, and the specific loan program.

3. FHA Loans: A Popular Option for Buyers With Limited Savings

Federal Housing Administration (FHA) loans are another option worth considering.

These government-insured mortgages allow eligible borrowers to purchase homes with down payments as low as 3.5%.

Some advantages include:

• Lower minimum down payments.
• More flexible credit qualifications than many conventional loans.
• Financing for qualifying owner-occupied properties containing up to four units.

For a $400,000 property, a 3.5% down payment would be just $14,000.

However, FHA loans require mortgage insurance, and borrowers must meet applicable credit, income, loan-limit, and property requirements.

4. MassHousing: Down Payment Assistance for Massachusetts Buyers

Massachusetts offers programs specifically designed to make homeownership more accessible.

One important resource is MassHousing, which provides affordable mortgage financing and down payment assistance for eligible homebuyers.

As of October 2026, MassHousing advertises down payment assistance of up to $30,000 for qualifying first-time buyers throughout Massachusetts.

The assistance must be paired with an eligible MassHousing mortgage and is provided as a second mortgage loan.

Depending on the approved option, repayment may be deferred or made through monthly payments.

Eligibility generally depends on factors such as:

• Household income.
• First-time homebuyer status.
• Property type and occupancy.
• Mortgage program requirements.
• Completion of an approved homebuyer education course.

These programs can make a meaningful difference for buyers who can afford monthly mortgage payments but struggle to save enough money upfront.

5. ONE Mortgage: A Massachusetts Program With Just 3% Down

The Massachusetts Housing Partnership (MHP) offers the ONE Mortgage program for eligible low- and moderate-income first-time homebuyers.

This program includes several attractive features:

• A minimum 3% down payment for qualifying single-family homes, condominiums, and two-family properties.
• A competitive fixed interest rate.
• No private mortgage insurance (PMI).
• Additional payment assistance for eligible households.

A 5% down payment is required for qualifying three-family properties.

Borrowers must satisfy program income, asset, credit, education, and occupancy requirements.

For eligible buyers, ONE Mortgage can be an excellent alternative to traditional financing.

6. Can You Buy a Home With No Down Payment?

In certain situations, yes.

Two mortgage programs may allow eligible borrowers to purchase a home without making a traditional down payment.

VA Loans

VA-backed mortgages are available to eligible veterans, active-duty service members, and certain surviving spouses.

These loans generally do not require a down payment, although lenders may require one in some circumstances.

USDA Loans

USDA mortgage programs help eligible buyers purchase homes in qualifying rural areas.

Some Massachusetts communities outside major urban centers may qualify, depending on the property’s exact location.

USDA programs also have income and other eligibility requirements.

It’s important to remember that a zero-down-payment mortgage does not necessarily mean zero closing costs.

7. What About Closing Costs?

Your down payment is only one part of the money you’ll need to purchase a home.

Buyers should also budget for expenses such as:

• Home inspections.
• Appraisal fees.
• Title-related expenses.
• Attorney fees.
• Lender charges.
• Prepaid homeowners insurance.
• Property tax adjustments and escrow deposits.

Closing costs vary based on the loan, property, location, and transaction.

Some buyers may qualify for closing cost assistance, lender credits, or negotiated seller concessions.

Understanding these expenses before making an offer can help prevent financial surprises.

8. Is It Better to Put Down 3% or Wait Until You Have 20%?

There is no single answer that works for everyone.

Waiting until you have a larger down payment can reduce your mortgage balance, lower monthly payments, and potentially eliminate PMI on a conventional loan.

However, waiting also has potential disadvantages.

Home prices and mortgage rates may change, and buyers may spend additional years renting while trying to reach their savings goals.

The right decision depends on your financial situation, including your income stability, emergency savings, monthly budget, and long-term plans.

Rather than focusing only on the down payment percentage, consider the total cost of homeownership.

9. How to Get Started Buying a Home in Massachusetts

If you’re thinking about purchasing a home but don’t have 20% saved, consider these steps:

1. Review your finances. Understand your income, debts, credit profile, and available savings.
2. Speak with a mortgage lender. Ask about conventional, FHA, MassHousing, and other low-down-payment programs.
3. Explore assistance programs. Find out whether you qualify for state or local homebuyer assistance.
4. Get pre-approved. A mortgage pre-approval helps establish a realistic price range.
5. Work with a local real estate professional. An experienced Massachusetts Realtor can help you identify suitable properties, understand local market conditions, and navigate the purchasing process.

Final Thoughts: Homeownership May Be Closer Than You Think

You don’t necessarily need $80,000 saved to buy a $400,000 home in Massachusetts.

Depending on your financial qualifications and mortgage program, your required down payment could be significantly smaller.

The key is understanding your options and building a realistic purchasing plan.

Ready to Buy a Home in Massachusetts?

Whether you’re purchasing your first home or exploring your financing options, professional guidance can make the process easier.

Contact us today to discuss your homeownership goals, explore available properties, and take the next step toward finding the right home in Massachusetts.

Disclaimer: This article is for general informational purposes only and does not constitute mortgage, legal, or financial advice. Mortgage terms, assistance availability, eligibility requirements, and program funding are subject to change. Consult a qualified mortgage lender for current information.