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Military personnel and veterans living in Massachusetts can now receive up to 100 percent financing on a single-family home or condo thanks to a new mortgage program coordinated by the state’s housing finance agency.
The new Operation Welcome Home loan program, introduced by MassHousing, is aimed at active duty service members, including members of the Reserves and Massachusetts National Guard, as well as honorably discharged veterans and Gold Star Family members. As part of this program, Fannie Mae will purchase the 97 percent financing first mortgage loans and MassHousing will retain the three percent second mortgage loans. Loan payments are made by borrowers to MassHousing, which will also service the loans.
Borrowers that put up less than a 20 percent downpayment will receive MassHousing’s MIPlus mortgage insurance, which includes unemployment protection at no additional cost. The program also offers low downpayment options for eligible borrowers seeking to purchase two- and three-family homes.
MassHousing said that it developed the loan program because few local lenders offer the VA loan product and because the VA loan program carried several restrictions for Massachusetts-based originations that are not found in other states.