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By Mario Ismailanji |
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Comments Off on Decoding Markets: Riding the Wave
All Boats Aren’t Built the Same
It doesn’t take Captain Obvious to see which way the wind – or rather, the wave – has been blowing in the stock market. Returns have been quite positive over the last month or two for most stocks, but some parts of the market have seen particularly big swells.
High-growth technology companies, especially those deeply involved with artificial intelligence, have been market leaders since the April 8 bottom. Like the broader market, these stocks have benefited from tariff pauses, but renewed investor enthusiasm for AI’s vast potential, and robust earnings reports from key AI players, have been an added boost.
On the year, a basket of AI stocks is up 8.3%, while the broader S&P 500 is barely positive, and the “Magnificent Seven” tech stocks are actually down 2.9%.
Cumulative Year-to-Date Returns
It can be challenging for investors when a concentrated part of the market does so well. Do you take profits or hold, hoping for further gains? History offers valuable context. Past market cycles have seen specific sectors lead market advances, sometimes with remarkable intensity, that can last for a long time.
The dot-com bubble of the late 1990s and early 2000s is a prominent example. An explosion of enthusiasm for internet-based companies fueled unsustainable valuations, sometimes with little to no earnings to show for it. But now, established tech giants are spearheading AI investment and generating substantial earnings and cash flows in the process. In the dot-com era, this wasn’t the case.
Expecting Higher CapEx
A defining feature of the current technology landscape is the colossal increase in capital expenditures (CapEx) by the Magnificent Seven and other leading tech companies. This translates into massive investments in the foundational elements of AI: power-intensive data centers; next-generation servers; R&D; and of course, purchasing chips.
Despite broader macroeconomic uncertainties, which initially led some investors to question if the AI build-out would slow, recent financial guidance from big tech companies solidified their commitment to ramp up investment even more.
Consensus expectations for the biggest players reflected this news, with the big four hyperscalers now expected to spend $311.4 billion on CapEx in 2025, versus $304.7 billion at the end of April (i.e. annual growth of 43.3% versus 40.2%).
Hyperscaler CapEx Consensus
However, there are obvious pitfalls associated with the aggressive investment plans of these companies. Concerns about a possible overbuild have been voiced, with Microsoft CEO Satya Nadella explicitly suggesting the industry could be heading in that direction. This presents a conundrum: The timing and extent of any potential over-investment are unknowable in advance, and it’s an open question when investors may price in the risks associated with unproductive capital allocation.
In the immediate term, the robust spending plans makes it unlikely that the AI theme will fall apart. But the future, as it usually is, is more uncertain.
To Diversification — and Beyond!
The stellar performance of the technology sector, supercharged by the AI narrative, makes it incredibly tempting for investors to heavily weight their portfolios in this area. The dominance of the Magnificent Seven over the last several years, for example, can foster the belief that concentrating on a few leading stocks or a single hot sector is the way to go. These seven companies now represent over 30% of the S&P 500’s market capitalization, and the weight of the top 10 stocks in the index is at multi-decade highs — drawing comparisons to the dot-com bubble.
Concentration has its drawbacks. Just like you can benefit on the way up, you’re vulnerable to drawdowns stemming from idiosyncratic risks. For instance, if investors become more skeptical of mega-cap tech companies’ ability to monetize these investments, related stocks could suffer disproportionately.
Importantly, diversification isn’t just a defensive strategy. It can position a portfolio to potentially benefit if (or when) currently lagging sectors heat up. That it can also offer protection against unforeseen sector-specific downturns, such as the tech-driven bear market of 2022 or the banking turmoil of 2023, is the cherry on top.
This point bears repeating: Market leadership is rarely permanent. History is filled with examples of sectors and individual stocks that led the market for a period, only to be eventually overtaken as conditions change. From industrial and energy companies in the 1970s and 1980s, to technology in the late 1990s, commodities and emerging markets in the 2000s, back to tech in the 2010s, and so on, things can change.
Artificial intelligence is undoubtedly a powerful force, but the same shifts that brought tech back into a leadership position can one day turn against it. Being mindful of that and prudently taking advantage of the benefits of diversification can help investors be prepared for whenever that moment comes.
Want more insights from SoFi’s Investment Strategy team? The Important Part: Investing With Liz Thomas, a podcast from SoFi, takes listeners through today’s top-of-mind themes in investing and breaks them down into digestible and actionable pieces.
SoFi can’t guarantee future financial performance, and past performance is no indication of future success. This information isn’t financial advice. Investment decisions should be based on specific financial needs, goals and risk appetite.
Communication of SoFi Wealth LLC an SEC Registered Investment Adviser. Information about SoFi Wealth’s advisory operations, services, and fees is set forth in SoFi Wealth’s current Form ADV Part 2 (Brochure), a copy of which is available upon request and at www.adviserinfo.sec.gov. Mario Ismailanji is a Registered Representative of SoFi Securities and Investment Advisor Representative of SoFi Wealth. Form ADV 2A is available at www.sofi.com/legal/adv.
The Louisiana housing market is a welcoming one. The average home value is $208,234, and has held fairly steady year over year, according to Zillow. Compare this to the national figure of $367,711, which is up 1.4% over the past year.
But just because home prices may be lower than in some other areas of the U.S. doesn’t mean that buying a first home is necessarily easy. That’s why it’s valuable to know that Louisiana offers several first-time homebuyer programs for low- and middle-income residents that can help newcomers break into the real estate market.
Read on to learn about ways to make buying your first home more affordable when you are house-hunting in Louisiana.
Who Qualifies as a First-Time Homebuyer?
If you’ve never bought a home, of course you’re a first-time homebuyer. But the U.S. Department of Housing and Urban Development (HUD) also classifies the following as first-time homebuyers:
• Someone who hasn’t owned a principal residence in the past three years
• A single parent who has only owned a home with a partner while married
• A displaced homemaker who has only owned a home with a spouse
• Someone who has owned a principal residence not permanently affixed to a permanent foundation
• Someone who has only owned a property that wasn’t in compliance with state, local, or model building codes
Also worth noting: Veterans often qualify for the same programs as first-time buyers.
💡 Quick Tip: Buying a home shouldn’t be aggravating. Online mortgage loan forms can make applying quick and simple.
6 Louisiana Programs for First-Time Homebuyers
The Louisiana Housing Corporation (LHC) allocates federal and state funds to low- and moderate-income homebuyers. It was created in 2011 in a merger of the Louisiana Housing Finance Agency with housing programs from other state agencies, including the Disaster Housing Task Force. The move helped centralize Louisiana’s housing policies and programs.
Many of LHC’s programs allow the purchase of a variety of properties, including single-family homes, condominiums, townhomes, modular homes, and manufactured homes. Here’s a closer look at LHC’s programs for first-time homebuyers, generally those who haven’t owned a principal home within the past three years.
This mortgage program is designed for buyers with incomes up to 80% of the area median income. Mortgage rates are usually below market, and down payment and closing cost assistance varies, depending on the amount of the loan. Discounted mortgage insurance premiums are also available. There are purchase price limits. Candidates must have a minimum credit score of 640 and complete a homebuyer education course.
2. LHC Mortgage Revenue Bond Assisted Program
This LHC MRB program helps first-time homebuyers and repeat buyers who plan to live in designated areas. Buyers in these areas with up to 140% of area median income may qualify. Interest rates on these loans are usually in line with the market. Down payment assistance is available through a second mortgage program.
Candidates must have a credit score of 640 and complete a homebuyer education course. The purchase price may not exceed limits set by the program.
3. LHC Premier Conventional Program
These loans are available to first-time homebuyers and repeat buyers who meet income requirements. Rates for 30-year fixed mortgages are competitive, and reduced mortgage insurance is available. The loan can be paired with LHC’s down payment assistance programs.
First-time buyers will need to complete a homebuyer education course; the 640 credit score minimum exists for all buyers. Unlike other LHC programs, this loan can only be used to purchase a single-family residence, and maximum loan amounts exist.
4. HC Delta 100 Program
The Delta 100 is aimed at first-time homebuyers without a credit history in specific Louisiana parishes. Mortgages are 30-year fixed at below market rates, with up to 3% closing cost assistance. The Delta 100 program requires borrowers to contribute 1% of the home purchase price or $1,500, whichever is less. Gifts are not allowed.
No credit score is needed. The loans can only be used for single-family homes. Buyers must complete a homebuyer education course.
5. Louisiana’s Resilience Soft Second Program
The Resilience Soft Second Program offers first-time homebuyers in the 51 parishes impacted by the 2016 floods a second mortgage of 20% of the home’s purchase price, up to $55,000. A maximum of $5,000 in closing costs is also included. Buyers who stay in the home as their primary residence for 10 years qualify for loan forgiveness.
To qualify, buyers must have income at or below 80% of the area median income and meet other qualifications. In addition, they must be buying a single-family home, condo, or townhome under certain purchase price limits and not in a flood zone. They also must complete a homebuyer education course.
6. Louisiana Mortgage Credit Certificate Program
Qualifying first-time homebuyers, veterans, and low- to moderate-income buyers purchasing a home in designated areas can take this Mortgage Credit Certificate Program assistance of a federal tax credit of 40% of their annual mortgage interest payments, up to $2,000 per year. Household income limits depend on the property location and household size. The credit can be taken for as long as the property is the buyer’s primary residence.
When looking into these programs, it’s also wise to review a general first-time homebuyer guide, so you can prepare for the process ahead.
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How to Apply to Louisiana Programs for First-Time Homebuyers
Get information and help figuring out if any of the programs listed above are right for you on the Louisiana Home Corporation website. Links are provided above. Purchase price and income limits for the Mortgage Revenue Bond programs and other details are also on the site.
LHC is not a lender, but the agency provides a list of approved partners for each program that you can use to find and compare lenders in your area.
For many programs, completion of LHC’s homebuyer education is required. This can help buyers understand how much mortgage they can afford and estimate monthly payments.
Some towns and nonprofits also have local programs for first-time homebuyers. So another smart move is to search online for the name of the town where you’d like to live plus the phrase “first-time homebuyer”.
Several federal government programs are designed for people who have low credit scores or limited cash for a down payment. Although most of these programs are available to repeat homeowners, like state programs, they can be especially helpful to people who are buying a first home or who haven’t owned a home in years.
The mortgages are generally for single-family homes, two- to four-unit properties that will be owner occupied, approved condos, townhomes, planned unit developments, and some manufactured homes. Review your options carefully to see if you can lower your mortgage payments with one of these programs.
Federal Housing Administration (FHA) Loans
The FHA, which is part of the US Department of Housing and Urban Development (HUD), insures mortgages for borrowers with lower credit scores. Homebuyers choose from a list of approved lenders that participate in the FHA loan program.
Loans have competitive interest rates and require a down payment of 3.5% of the purchase price for borrowers, who typically need FICO® credit scores of 580 or higher. Those with low credit scores between 500 and 579 must put at least 10% down.
In addition to examining your credit score, lenders will look at your debt-to-income ratio (DTI, your monthly debt payments compared with your monthly gross income). FHA loans allow a DTI ratio of up to 57% in some cases, vs. a typical 45% or 50% maximum for a conventional loan.
Gift money for the down payment is allowed from certain donors, which can be helpful. It will likely need to be documented in a gift letter for the mortgage.
FHA loans always require mortgage insurance: a 1.75% upfront fee and annual premiums for the life of the loan, unless you make a down payment of at least 10%, which allows the removal of mortgage insurance after 11 years.
Very low- and low-income borrowers may make a 3% down payment on a Home Possible® mortgage. These loans allow various sources for down payments, including co-borrowers, family gifts, employer assistance, secondary financing, and sweat equity.
The Home Possible mortgage is for buyers who have a credit score of at least 660.
Once you pay 20% of your loan, the Home Possible mortgage insurance will be canceled, which will lower your mortgage payments.
Fannie Mae HomeReady Mortgages
Fannie Mae HomeReady® Mortgages allow down payments as low as 3% for low-income borrowers. You’ll generally need a credit score of at least 620; pricing may be better for credit scores of 680 and above. Like the Freddie Mac program, HomeReady loans allow flexibility for down payment financing, such as gifts and grants.
The conventional 97 LTV loan is for first-time homebuyers of any income level who have a credit score of at least 620 and meet debt-to-income criteria. The 97% loan-to-value mortgage requires 3% down, as the name may suggest. Borrowers can get down payment and closing cost assistance from third-party sources.
Unlike an FHA loan, the 97 LTV loan has no upfront mortgage insurance fee, and it does have cancellable mortgage insurance. The loan is for just one-unit single-family homes, co-ops, condos, planned unit developments, and eligible manufactured homes.
Department of Veterans Affairs (VA) Loans
Active-duty members of the military, veterans, and eligible Eligible active-duty members of the military, veterans, reservists, and surviving spouses may apply for loans backed by the Department of Veterans Affairs. VA loans, which can be used to buy, build, or improve homes, have lower interest rates than most other mortgages and don’t require a down payment. Most borrowers pay a one-time funding fee that can be rolled into the mortgage.
Here’s another benefit of VA loans: They do not require private mortgage insurance (PMI) for borrowers who make a down payment of less than 20%. And they have more flexible credit score requirements. In some cases, even those who have previously been in foreclosure or bankruptcy can qualify.
Borrowers applying for a VA loan will need a Certificate of Eligibility from the VA so make sure to review a guide to qualifying for a VA loan as a first step in the process.
💡 Quick Tip: Active duty service members who have served for at least 90 consecutive days are eligible for a VA loan. But so are many veterans, surviving spouses, and National Guard and Reserves members. It’s worth exploring with an online VA loan application because the low interest rates and other advantages of this loan can’t be beat.†
Native American Veteran Direct Loans (NADLs)
Eligible Native American veterans and their spouses may use these 0% down loans to buy, improve, or build a home on federal trust land. The Department of Veterans Affairs is the lender for NADLs. The funding fee applies. To learn more, contact [email protected].
U.S. Department of Agriculture (USDA) Loans
No down payment is required for USDA-backed loans for property in specified rural areas. Borrowers must meet income requirements, and there are fees associated with these loans. Eligible properties are listed by region on the USDA website .
U.S. Department of Housing and Urban Development (HUD) Good Neighbor Next Door Program
Police officers, firefighters, emergency medical technicians, and teachers can receive 50% off a home in a “revitalization area.” To qualify, borrowers must live in the home for at least three years. HUD offers more information on homeownership programs in Louisiana on its website.
Louisiana Homebuyer Stats for 2025
Here’s a snapshot of the typical home purchase in Louisiana.
• Average home value: $208,234
• Median down payment: $20,500
• Average credit score among homebuyers: 690
Financing Tips for First-Time Homebuyers
In addition to federal and state government-sponsored lending programs, there are other financial strategies that may help you become a homeowner. Some examples:
• Traditional IRA withdrawals. The IRS allows qualifying first-time homebuyers a one-time, penalty-free withdrawal of up to $10,000 from their IRA if the money is used to buy, build, or rebuild a home. When it comes to IRA withdrawals, the IRS considers anyone who has not owned a primary residence in the past two years a first-time homebuyer. You will still owe income tax on the IRA withdrawal. If you’re married and your spouse has an IRA, they may also make a penalty-free withdrawal of $10,000 to purchase a home. The downside, of course, is that large withdrawals may take a big bite out of your retirement savings.
• Roth IRA withdrawals. Because Roth IRA contributions are made with after-tax money, the IRS allows tax- and penalty-free withdrawals of contributions for any reason as long as you’ve held the account for five years. You may also withdraw up to $10,000 in earnings from your Roth IRA without paying taxes or penalties if you are a qualifying first-time homebuyer and you have had the account for five years. With accounts held for less than five years, homebuyers will have to pay income tax on earnings withdrawn.
• 401(k) loans. If your employer permits borrowing from the 401(k) plan that it sponsors, you may consider taking a loan against the 401(k) account to help finance your home purchase. With most plans, you can borrow up to 50% of your 401(k) balance, up to $50,000, within a 12-month period without incurring any taxes or penalties. You pay interest on the loan, which is paid into your 401(k) account. You usually have to pay back the loan within five years, but if you’re using the money to buy a house, you may have up to 15 years to repay.
• State and local down payment assistance programs. Usually offered at the regional or county level, these programs provide flexible second mortgages for first-time buyers looking into how to afford a down payment.
• The mortgage credit certificate program. First-time homeowners and those who buy in targeted areas can claim a portion of their mortgage interest as a tax credit, up to $2,000. Any additional interest paid can still be used as an itemized deduction. To qualify for the credit, you must be a first-time homebuyer, live in the home, and meet income and purchase price requirements, which vary by state. If you refinance, the credit disappears, and if you sell the house before nine years, you may have to pay some of the tax credit back.
Note: There are fees associated with applying for and receiving the mortgage credit certificate that vary by state. Often the savings from the lifetime of the credit can outweigh these fees.
• Your employer. Your employer may offer access to lower-cost lenders and real estate agents in your area, as well as home buying education courses.
• Your lender. Always ask your lender about any first-time homebuyer grant or down payment assistance programs available from government, nonprofit, and community organizations in your area.
The Takeaway
Louisiana supports several first-time home-buying programs that can help residents achieve their goal of homeownership. This can be in the form of assistance with a down payment, mortgage, closing costs, and other expenses. In addition to statewide programs, there are initiatives for residents living in specific parishes. Low- and moderate-income Louisianans may find alternatives among the federal government’s first-time homebuyer programs, as well as offers from private lenders.
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
Solid information is key to a successful home-buying experience for anyone, but especially for newcomers. First-time homebuyer classes can help. Indeed they are required for some government-sponsored loan programs.
Do first-time homebuyers with bad credit qualify for homeownership assistance?
Often they do. Many government and nonprofit homeowner assistance programs are available to people with low credit scores. And often, interest rates and other loan pricing are competitive with those of loans available to borrowers with higher credit scores.
Is there a first-time veteran homebuyer assistance program in Louisiana?
Many of the Louisiana Home Corporation’s first-time buyer programs include veteran benefits. Louisiana veterans also may find options in the federal VA loan programs.
What credit score do I need for first-time homebuyer assistance in Louisiana?
Most programs administered by the Louisiana Home Corporation require a credit score of 640 or above. But borrowers with lower scores may be able to access other private, state, and federal loan programs.
What is the average age of first-time homebuyers in Louisiana?
There’s little data available to track the average age of first-time homebuyers in specific states, but the national median age of first-time homebuyers was 38 as of late 2024, an all-time high.
Photo credit: iStock/Rebecca Todd
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*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.
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¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.
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Qualifying for the reward requires using a real estate agent that participates in HomeStory’s broker to broker agreement to complete the real estate buy and/or sell transaction. You retain the right to negotiate buyer and or seller representation agreements. Upon successful close of the transaction, the Real Estate Agent pays a fee to HomeStory Real Estate Services. All Agents have been independently vetted by HomeStory to meet performance expectations required to participate in the program. If you are currently working with a REALTOR®, please disregard this notice. It is not our intention to solicit the offerings of other REALTORS®. A reward is not available where prohibited by state law, including Alaska, Iowa, Louisiana and Missouri. A reduced agent commission may be available for sellers in lieu of the reward in Mississippi, New Jersey, Oklahoma, and Oregon and should be discussed with the agent upon enrollment. No reward will be available for buyers in Mississippi, Oklahoma, and Oregon. A commission credit may be available for buyers in lieu of the reward in New Jersey and must be discussed with the agent upon enrollment and included in a Buyer Agency Agreement with Rebate Provision. Rewards in Kansas and Tennessee are required to be delivered by gift card.
HomeStory will issue the reward using the payment option you select and will be sent to the client enrolled in the program within 45 days of HomeStory Real Estate Services receipt of settlement statements and any other documentation reasonably required to calculate the applicable reward amount. Real estate agent fees and commissions still apply. Short sale transactions do not qualify for the reward. Depending on state regulations highlighted above, reward amount is based on sale price of the home purchased and/or sold and cannot exceed $9,500 per buy or sell transaction. Employer-sponsored relocations may preclude participation in the reward program offering. SoFi is not responsible for the reward.
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There’s something for just about everyone in Colorado — especially those who love the great outdoors. The state is known for its ski resorts, hiking and biking trails, and 300 days of sunshine each year.
But for first-time homebuyers in Colorado, putting down roots can be a challenge, whether they’re hoping to find a home in a mountain town, in the suburbs, or in bustling downtown Denver. According to Redfin, the median home sales price in Colorado in April 2025 was $625,500, a 0.45% decrease in 12 months. However, prices are still rising in many cities, including Aspen, Berthoud, and Castlewood. On average, across the state, 24.8% of homes were selling above the list price.
Fortunately, Colorado homebuyers may be able to get financial help through programs offered by the state and some cities and counties. There also are longstanding federal programs that could improve a buyer’s chances of success.
Who Is Considered a First-Time Homebuyer in Colorado?
First things first: The definition of first-time homebuyer is more expansive than it seems. For most programs offered in Colorado, and elsewhere, applicants are considered first-time homebuyers if they haven’t owned a home for the past three years. Let’s look at some of the programs designed to get first-time homebuyers a home mortgage loan or help with closing costs.
6 Colorado Programs for First-Time Homebuyers
Most first-time homebuyer programs in Colorado are designed to help low- to moderate-income buyers who need assistance coming up with a down payment or closing costs.
Program participants typically must meet eligibility requirements regarding their income, credit scores, and debt-to-income (DTI) ratio. There also may be limits on how much the home costs, and it usually must be owner occupied. Also, at least one of the buyers must complete a homebuyer education course.
The Colorado Housing and Finance Authority (CHFA) provides several assistance options for first-time buyers. The FirstStep and FirstStep Plus programs offer qualifying first-time homebuyers, veterans, and buyers who are purchasing in a targeted area a 30-year fixed-rate Federal Housing Administration (FHA) loan along with the opportunity to apply for a deferred second loan to put toward their down payment or closing costs.
The FirstStep Plus no-payment, 0% interest second mortgage may be for up to 4% of the first mortgage amount.
Qualifications include:
• Borrowers must have a 620 or higher credit score
• Maximum DTI of 50% to 55% (depending on credit score)
The HomeAccess and HomeAccess Plus program offers qualifying first-time or repeat homebuyers and veterans a 30-year fixed-rate USDA, VA, or FHA loan that may be paired with a 0% interest second mortgage of up to $25,000 for down payment/closing cost assistance. Applicants must have a permanent disability or a child with a permanent disability.
Qualifications include:
• Borrowers must have a 620 or higher credit score
• Maximum DTI of 50% to 55% (depending on credit score)
• Must meet income and purchase price limits
• Must attend a homebuyer education class
• Must make a minimum borrower contribution of $500 toward the purchase (may be a gift)
• No cosigners or non-occupying co-borrowers
See the flyer to get more information and apply with one of the two participating lenders.
3. CHFA SectionEight Homeownership
Some public housing authorities (PHAs) allow would-be homeowners to use a Section 8 housing choice voucher to buy a home or pay monthly homeownership expenses instead of paying rent. The amount of money that Section 8 pays for a home is the same as the amount it would pay for rent. Not all PHAs do this, so check with your local PHA if you are in Section 8 housing. This may be paired with other first-time homebuyer programs that provide down payment and mortgage assistance.
4. Other CHFA Homebuyer Programs
If you aren’t sure whether you’ll qualify as a first-time homebuyer, here are some other CHFA programs you might want to look into:
CHFA SmartStep and SmartStep Plus offers eligible borrowers a 30-year fixed-rate FHA, VA, or USDA loan that may be paired with down payment assistance in the form of a second mortgage.
CHFA Preferred and Preferred Plus offers homebuyers a 30-year fixed-rate Fannie Mae HFA Preferred or Freddie Mac HFA Advantage loan that may be paired with a second mortgage for down payment assistance.
CHFA Preferred VLIP is only for very low-income borrowers. It offers a 30-year fixed-rate Freddie Mac HFA Advantage loan that may be paired with a second mortgage for down payment assistance.
The Colorado Housing Assistance Corporation (CHAC) provides low-interest second loans to low- and moderate-income first-time homebuyers who need help with their down payment and closing costs.
Qualifications include:
• Borrower income limits are set at 80% of the area median income in most communities (higher in Arvada)
• Must make a minimum borrower contribution of at least 1% of the sales price ($750 for disability program), and this amount generally cannot be a gift
• Must attend a CHAC homebuyer education class
• Must disclose all income sources for occupants over 18
• Must provide proof of legal residency for all household members if requested
• Home price and asset limits apply
For more information, see this page . Applications are submitted through your mortgage lender.
6. Mortgage Credit Certificate
First-time homebuyers in Colorado also may benefit from obtaining a mortgage credit certificate through a CHFA-approved lender. Borrowers can use a certificate to claim a portion of their mortgage interest, dollar for dollar, up to $2,000, as a federal tax credit every year for the life of their loan.
You can apply for the credit certificate when you take out a home loan through a participating lender .
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real estate agent and earn up to
$9,500‡ cash back when you close.
Pair up with a local real estate agent through HomeStory and unlock up to $9,500 cash back at closing.‡ Average cash back received is $1,700.
If you’ve already chosen the Colorado city or county you hope to make your home, you may also want to research local buyer assistance programs.
If you can’t find assistance in your chosen location, check back occasionally for new offers. Some first-time homebuyer programs base their opportunities (and deadlines) on the funds they expect to become available. When their money runs out, they may press pause.
Aurora Assistance Program
Aurora’s Home Ownership Assistance Program was created to assist low- and moderate-income first-time homebuyers. It provides up to $10,000 in assistance to buyers in Aurora who need help covering down payment and closing costs. For information on benefits and requirements, you can email [email protected], or call 303-739-7900.
Boulder Programs
The city of Boulder is offering several assistance opportunities to low-, moderate-, and higher-middle-income first-time homebuyers. The programs include down payment assistance loans and grants, as well as a program that offers homes for sale at below-market prices to income-eligible owner-occupiers.
You can get eligibility requirements and how to apply by going to the program’s website . If you’re planning to purchase in Boulder County but the home is outside the city limits, ask your lender about other programs that may be available to you.
Douglas County Down Payment Assistance
The Douglas County Housing Partnership offers a down payment assistance program to first-time homebuyers, with preference given to borrowers who currently live and/or work in the county. For information on the benefits and requirements, check out the website or call the partnership at 303-660-7460.
Eagle County Down Payment Assistance
Eagle County’s program has a few variations, and your assistance may be based on the type of first mortgage you obtain, where you plan to live, your income, and other factors. Get more information at the program’s website . If you have questions, you can email [email protected] or call 970-328-8770.
MetroDPA Program
The MetroDPA down payment assistance program is for homebuyers with up to $195,600 of qualifying income who purchase a home in the Front Range, from Castle Rock to Wellington. For information on benefits and eligibility requirements, check out the program’s website
How to Apply to Colorado Programs for First-Time Homebuyers
The way to get more information about each program, and apply, is described above.
Often an approved lender is the go-to for assistance programs.
Several federal government programs are designed for people who have low credit scores or limited cash for a down payment. Although most of these programs are available to repeat homeowners, like state programs, they can be especially helpful to people who are buying a first home or who haven’t owned a home in several years.
The mortgages are generally for single-family homes, two- to four-unit properties that will be owner occupied, approved condos, townhomes, planned unit developments, and some manufactured homes.
Federal Housing Administration (FHA) Loans
The FHA, which is part of the U.S. Department of Housing and Urban Development (HUD), insures mortgages for borrowers with lower credit scores. Homebuyers choose from a list of approved lenders that participate in the FHA loan program. Loans have competitive interest rates and require a down payment of 3.5% of the purchase price for borrowers, who typically need FICO® credit scores of 580 or higher. Those with scores as low as 500 must put at least 10% down.
In addition to examining your credit score, lenders will look at your debt-to-income ratio (DTI, your monthly debt payments compared with your monthly gross income). FHA loans allow a DTI ratio of up to 57% in some cases, vs. a typical 45% maximum for a conventional loan.
Gift money for the down payment is allowed from certain donors and will be documented in a gift letter for the mortgage.
FHA loans always require mortgage insurance: a 1.75% upfront fee and annual premiums for the life of the loan, unless you make a down payment of at least 10%, which allows the removal of mortgage insurance after 11 years. For a $300,000 mortgage balance, upfront MIP would be around $5,250 and monthly MIP, at a rate of 0.55%, would be around $137. You can learn more about these loans, including FHA loans for refinance and rehab of properties, by reading up on FHA requirements, loan limits, and rates.
Freddie Mac Home Possible Mortgages
Very low- and low-income borrowers may make a 3% down payment on a Home Possible® mortgage. These loans allow various sources for down payments, including co-borrowers, family gifts, employer assistance, secondary financing, and sweat equity.
The Home Possible mortgage is for buyers who have a credit score of at least 660.
Once you pay 20% of your loan, the Home Possible mortgage insurance will be canceled, which will lower your mortgage payments.
Fannie Mae HomeReady Mortgages
Fannie Mae HomeReady® Mortgages allow down payments as low as 3% for low-income borrowers. Applicants generally need a credit score of at least 620; pricing may be better for credit scores of 680 and above. Like the Freddie Mac program, HomeReady loans allow flexibility for down payment financing, such as gifts and grants.
For income limits, a comparison to an FHA loan, and other information, go to this Fannie Mae site .
Fannie Mae Standard 97 LTV Loan
The conventional 97 LTV loan is for first-time homebuyers of any income level who have a credit score of at least 620 and meet debt-to-income criteria. The 97% loan-to-value mortgage requires 3% down. Borrowers can get down payment and closing cost assistance from third-party sources.
Department of Veterans Affairs (VA) Loans
Eligible active-duty members of the military, veterans, reservists, and surviving spouses may apply for loans backed by the Department of Veterans Affairs. VA loans, which can be used to buy, build, or improve homes, have lower interest rates than most other mortgages and don’t require a down payment. Most borrowers pay a one-time funding fee that can be rolled into the mortgage.
Another benefit of VA loans is that they do not require private mortgage insurance (PMI) for borrowers who make a down payment of less than 20%. And they have more flexible credit score requirements. In some cases, even those who have previously been in foreclosure or bankruptcy can qualify.
Borrowers applying for a VA loan will need a Certificate of Eligibility from the VA so make sure to review a guide to qualifying for a VA loan as a first step in the process.
Native American Veteran Direct Loans (NADLs)
Eligible Native American veterans and their spouses may use these no-down-payment loans to buy, improve, or build a home on federal trust land. Unlike VA loans listed above, the Department of Veterans Affairs is the mortgage lender on NADLs. The VA requires no mortgage insurance, but it does charge a funding fee.
US Department of Agriculture (USDA) Loans
No down payment is required on these loans to moderate-income borrowers that are guaranteed by the USDA in specified rural areas. Borrowers pay an upfront guarantee fee and an annual fee that serves as mortgage insurance.
The USDA also directly issues loans to low- and very low-income people. For loan basics and income and property eligibility, head to this USDA site .
HUD Good Neighbor Next Door Program
This program helps police officers, firefighters, emergency medical technicians, and teachers qualify for mortgages in the areas they serve. Borrowers can receive 50% off a home in what HUD calls a “revitalization area.” They must live in the home for at least three years.
You’re probably curious about where you fit amid the mix of homebuyers out there. Here are some stats:
• Percentage of buyers nationwide who are first-time buyers: 24%
• Median age of first-time homebuyers nationally: 38
• Median home price in Colorado: $625,500
• Median gross rent: $1,713
• 66.3% of Colorado housing units were owner-occupied
• Average credit score in Colorado: 731
Additional Financing Tips for First-Time Homebuyers
In addition to federal and state government-sponsored lending programs, there are other financial strategies that may help you become a homeowner. Some examples:
• Traditional IRA withdrawals. The IRS allows qualifying first-time homebuyers a one-time, penalty-free withdrawal of up to $10,000 from their IRA if the money is used to buy, build, or rebuild a home. The IRS considers anyone who has not owned a primary residence in the past two years a first-time homebuyer. You will still owe income tax on the IRA withdrawal. If you’re married and your spouse has an IRA, they may also make a penalty-free withdrawal of $10,000 to purchase a home. The downside, of course, is that large withdrawals may jeopardize your retirement savings.
• Roth IRA withdrawals. Because Roth IRA contributions are made with after-tax money, the IRS allows tax- and penalty-free withdrawals of contributions for any reason as long as you’ve held the account for five years. You may also withdraw up to $10,000 in earnings from your Roth IRA without paying taxes or penalties if you are a qualifying first-time homebuyer and you have had the account for five years. With accounts held for less than five years, homebuyers will pay income tax on earnings withdrawn.
• 401(k) loans. It may be possible to borrow from the 401(k) plan that your employer sponsors or take a loan against the 401(k) account to help finance your home purchase. With most plans, you can borrow up to 50% of your 401(k) balance, up to $50,000, in a year without incurring taxes or penalties. You pay interest on the loan, which is paid into your 401(k) account. You usually have to pay back the loan within five years, but if you’re using the money to buy a house, you may have up to 10 years or more to repay.
• State and local down payment assistance programs. Usually offered at the regional or county level, these programs provide flexible second mortgages for first-time buyers looking into how to afford a down payment.
• The mortgage credit certificate program. First-time homeowners and those who buy in targeted areas can claim a portion of their mortgage interest as a tax credit, up to $2,000. Any additional interest paid can still be used as an itemized deduction. To qualify for the credit, you must be a first-time homebuyer, live in the home, and meet income and purchase price requirements, which vary by state. If you refinance, the credit disappears, and if you sell the house before nine years, you may have to pay some of the tax credit back. There are fees associated with applying for and receiving the mortgage credit certificate that vary by state. Often the savings from the lifetime of the credit can outweigh these fees.
• Your employer. Your employer may offer access to lower-cost lenders and real estate agents in your area, as well as home-buying education courses.
• Your lender. Always ask your lender about any first-time homebuyer grant or down payment assistance programs available from government, nonprofit, and community organizations in your area.
The Takeaway
A robust assortment of mortgage and down payment help in Colorado allows qualifying first-time homebuyers to afford a home of their own. Others may have to blaze their own trail to find a mortgage that’s a good fit. Keep in mind that borrowers who go with a conventional loan don’t necessarily have to come up with a 20% down payment. (And most buyers don’t.)
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
Yes! Being informed is key to a successful home-buying experience for anyone, but especially for newcomers, who can easily be overwhelmed by the jargon, technicalities, and magnitude of applying for a mortgage and purchasing a home. First-time homebuyer classes can help; in fact, they are required for certain government-sponsored loan programs.
Do first-time homebuyers with bad credit qualify for homeownership assistance?
Often they can qualify. Many government and nonprofit homeowner assistance programs are available to people with low credit scores. And often, interest rates and other loan pricing are competitive with those of loans available to borrowers with higher credit scores. That said, almost any lending program has credit qualifications.
Is there a first-time homebuyer tax credit in Colorado?
Yes. The CHFA administers a mortgage credit certificate program that allows qualifying borrowers to claim a portion of their annual mortgage interest as a federal credit every year for the life of their loan.
Is there a first-time veteran homebuyer assistance program in Colorado?
The CHFA’s programs offer homebuyer benefits for veterans. VA home loans are available nationwide to eligible service members, veterans, reservists, and eligible surviving spouses.
What credit score do I need for first-time homebuyer assistance in Colorado?
Most homebuyer programs offered by the Colorado Housing and Finance Authority require a minimum 620 credit score. But requirements may vary from one program or organization to the next, and some programs use criteria other than credit scores to determine a borrower’s eligibility. You can check with the organization or lender offering first-time homebuyer assistance to get specific financial requirements.
What is the average age of first-time homebuyers?
The median age of first-time buyers is 38.
Photo credit: iStock/haveseen
*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.
†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.
¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.
SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
‡Up to $9,500 cash back: HomeStory Rewards is offered by HomeStory Real Estate Services, a licensed real estate broker. HomeStory Real Estate Services is not affiliated with SoFi Bank, N.A. (SoFi). SoFi is not responsible for the program provided by HomeStory Real Estate Services. Obtaining a mortgage from SoFi is optional and not required to participate in the program offered by HomeStory Real Estate Services. The borrower may arrange for financing with any lender. Rebate amount based on home sale price, see table for details.
Qualifying for the reward requires using a real estate agent that participates in HomeStory’s broker to broker agreement to complete the real estate buy and/or sell transaction. You retain the right to negotiate buyer and or seller representation agreements. Upon successful close of the transaction, the Real Estate Agent pays a fee to HomeStory Real Estate Services. All Agents have been independently vetted by HomeStory to meet performance expectations required to participate in the program. If you are currently working with a REALTOR®, please disregard this notice. It is not our intention to solicit the offerings of other REALTORS®. A reward is not available where prohibited by state law, including Alaska, Iowa, Louisiana and Missouri. A reduced agent commission may be available for sellers in lieu of the reward in Mississippi, New Jersey, Oklahoma, and Oregon and should be discussed with the agent upon enrollment. No reward will be available for buyers in Mississippi, Oklahoma, and Oregon. A commission credit may be available for buyers in lieu of the reward in New Jersey and must be discussed with the agent upon enrollment and included in a Buyer Agency Agreement with Rebate Provision. Rewards in Kansas and Tennessee are required to be delivered by gift card.
HomeStory will issue the reward using the payment option you select and will be sent to the client enrolled in the program within 45 days of HomeStory Real Estate Services receipt of settlement statements and any other documentation reasonably required to calculate the applicable reward amount. Real estate agent fees and commissions still apply. Short sale transactions do not qualify for the reward. Depending on state regulations highlighted above, reward amount is based on sale price of the home purchased and/or sold and cannot exceed $9,500 per buy or sell transaction. Employer-sponsored relocations may preclude participation in the reward program offering. SoFi is not responsible for the reward.
SoFi Bank, N.A. (NMLS #696891) does not perform any activity that is or could be construed as unlicensed real estate activity, and SoFi is not licensed as a real estate broker. Agents of SoFi are not authorized to perform real estate activity.
If your property is currently listed with a REALTOR®, please disregard this notice. It is not our intention to solicit the offerings of other REALTORS®.
Reward is valid for 18 months from date of enrollment. After 18 months, you must re-enroll to be eligible for a reward.
SoFi loans subject to credit approval. Offer subject to change or cancellation without notice.
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• A good credit score, low debt, and a large down payment can all boost your chances of landing a more attractive interest rate.
• A good credit score, low debt, and a large down payment can all boost your chances of landing a more attractive interest rate.
• Investigate first-time homebuyer programs for financial aid and lower down payment options.
• Mortgage rates are influenced by economic factors like the bond market, inflation, and the housing market.
• Use online mortgage calculators to compare monthly payments and total interest paid for different loan offers.
Introduction to Mortgage Rates
Mortgage rates in Hampton, Virginia, are a key consideration for anyone buying a home in this area. This guide is designed to help you understand how mortgage rates are determined and how you can secure the best rate in Hampton. We’ll cover the economic and personal factors that influence the mortgage rates you’re likely to be offered and provide you with tips on how to get the best deal on your mortgage. The more you know about mortgage rates, the better equipped you will be to make a smart decision.
Where Mortgage Rates Come From
The mortgage interest rates lenders offer you depends on multiple factors. The bond market has a major influence on rates, especially the 10-year U.S. Treasury Note. When interest rates on the note go up, home loan rates usually rise as well. Inflation and the housing market can also play a role.
Mortgage rates are also personalized for individual borrowers, taking into account their finances and credit history. The rates lenders offer you are influenced especially by your credit score. The higher your score, the lower the rate you’re likely to get. Making a larger down payment may also decrease your rate since lenders assume that a homebuyer who has more equity in their home will be less likely to default.
Finally, lenders consider your debt-to-income (DTI) ratio when determining your interest rate. They like to see a DTI ratio of 36% or less, ideally.
See what factors impact your mortgage.
See how different loan amounts, down payments, and other factors impact your home mortgage with our mortgage calculator.
See what factors impact your mortgage.
See how different loan amounts, down payments, and other factors impact your home mortgage with our mortgage calculator.
How Interest Rates Affect Home Affordability
Mortgage rates in Hampton, Virginia, can have a big impact on the affordability of a home.
Let’s break it down. A $400,000 loan at a 6.50% interest rate would have a monthly payment of $2,528. But if the interest rate is half a percentage point higher, at 7.00%, the monthly payment would increase to $2,661.
Over 30 years, a homeowner with the lower rate would save almost $48,000 in interest.
The moral is that it’s worthwhile to compare offers from multiple lenders, negotiate, and do your best to improve your financial standing. Because getting a better rate can have a big impact on your monthly budget and long-term financial health.
If you want to get the best mortgage rate in Hampton, some historical perspective on rates can be helpful. For example, it’s true that average mortgage rates rose from their all-time low in 2021. But they’re still nowhere near the highs they hit in earlier decades.
The 50-year interest rate graph below illustrates the fluctuating nature of mortgage rates. You’ll see that recent rates remain well below historical highs.
For a local look, the chart below the graph compares Virginia’s average yearly interest rate to the national average. (The Federal Housing Finance Agency stopped compiling this data after 2018.) Note that Virginia’s rates are typically quite close to national rates.
Year
Virginia Rate
U.S. Rate
2000
8.03
8.14
2001
7.02
7.03
2002
6.54
6.62
2003
5.82
5.83
2004
5.70
5.95
2005
5.93
6.00
2006
6.54
6.60
2007
6.41
6.44
2008
6.02
6.09
2009
4.97
5.06
2010
4.71
4.84
2011
4.52
4.66
2012
3.67
3.74
2013
3.86
3.92
2014
4.16
4.24
2015
3.96
3.91
2016
3.77
3.72
2017
4.10
4.03
2018
4.59
4.57
Source: Federal House Finance Agency
Should You Wait for Interest Rates to Take a Dip?
If you’re looking to buy a home in Hampton, there’s a good chance you’re wondering whether you should put your plans on hold to see if interest rates are going to drop. While it’s always smart to keep an eye on the market, current predictions anticipate that mortgage rates are likely to remain relatively stable in the near future. According to Fannie Mae estimates, the average mortgage rate will probably land around 6.30% by the end of 2025, and 6.20% at the close of 2026.
Remember, if rates drop after you’ve bought your home, you can always opt for a mortgage refinance down the road.
How Costs Stack Up in Hampton
The cost of living in your city can be a major factor as you plan your finances, since it has an impact both on home prices and on how easy (or not) it will be for you to budget for your monthly mortgage payments.
Here’s how Hampton compares to other towns in Virginia on an index where 100 equals the average cost of living in the U.S.
To secure the best mortgage rate in Hampton, Virginia, it pays to play the long game. Think about making the following smart moves, even if you’re at the very beginning of your home-buying journey.
• Strength your credit score by making your payments on time and paying down your credit card balances.
• Lower your debt-to-income (DTI) ratio by chipping away at your debts, starting with the highest interest rate.
• Make a larger down payment if you can, using savings and gifts from friends and family.
• Compare rates from multiple lenders to find the best rate and fees, since they vary quite a bit by lender.
• Consider going through the mortgage preapproval process. This can give you a clearer sense of what will be affordable.
Tools & Calculators
When it comes to making the right choices for your home purchase in Hampton, Virginia, online calculators are your friend. A mortgage calculator, for instance, can help you see the big picture by estimating your monthly payments and total costs given different interest rates and loan terms. Comparing offers from different lenders is a smart move, and online tools make it easy to make the most cost-effective choice.
Using the free calculators is for informational purposes only, does not constitute an offer to receive a loan, and will not solicit a loan offer. Any payments shown depend on the accuracy of the information provided.
Types of Mortgages Available in Hampton
In Hampton, Virginia, you’ve got many types of mortgage loans to choose from, each tailored to different financial scenarios.
Conventional mortgages are a solid choice if your credit score is 620 or higher. These loans typically have competitive rates and offer a variety of terms and down payment options. But don’t worry if a conventional loan doesn’t seem right for you: There are other possibilities, like FHA and VA loans, which have lower down payment requirements and more forgiving credit requirements.
Fixed-Rate Mortgages
A fixed-rate mortgage provides you with the security of knowing your interest rate will remain the same for the entire loan term. That means your monthly payments will be predictable, which helps you budget more effectively. There are a variety of loan terms, though you’ll probably see 15- and 30-year options most often. While a 30-year term often translates to lower monthly payments, it’s essential to consider the cumulative interest cost over time. If you can afford the payments on a 15-year fixed-rate loan, you’ll pay much less interest over the life of the loan.
Adjustable-Rate Mortgages (ARMs)
Adjustable-rate mortgages (ARMs) generally start off with a lower rate than fixed-rate loans. After an introductory period of several years, the rate adjusts regularly in accordance with the market. If your initial period is seven years, say, and you know you’ll have to relocate and sell your house in five, getting an ARM can be a smart strategic decision. But if your plans change, make sure you’re well-versed in the cap and adjustment frequency of your loan so that you won’t be completely taken by surprise by fluctuating mortgage payments.
FHA Loans
Backed by the Federal Housing Administration, FHA loans can open the door to homeownership for many people by offering more relaxed eligibility criteria than conventional loans. Typically, a credit score of 580 and a minimum down payment of 3.5% are required, and these loans are very popular with first-time homebuyers. These loans do come with a mortgage insurance premium: 1.75% of the loan amount upfront and then between 0.15% and 0.75% every month.
VA Loans
VA loans are available to those who have served our country. Borrowers who are eligible include active-duty military members, veterans, reservists, National Guard members, and some surviving spouses. One of the primary benefits of VA loans is that they don’t require a down payment, which can make homeownership more accessible. Additionally, VA loans often come with lower interest rates and no private mortgage insurance (PMI). If you’re eligible, exploring VA loans can be a smart financial move.
Jumbo Loans
In most parts of the country, including Hampton, the conventional loan limit for a single-family home is $806,500. If you have to borrow more than this amount to purchase a property, you’ll need a jumbo loan. Jumbo loans typically have more stringent qualification requirements, such as higher credit scores and larger down payments. A jumbo loan could be a smart choice for buying a more expensive property, but be sure to consider the terms and conditions of jumbo loans to ensure they fit your financial goals.
Current mortgage rates by state.
Compare current home interest rates by state and find a mortgage rate that suits your financial goals.
Select a state to view current rates:
How to Evaluate Loan Offers in Hampton
A competitive mortgage rate can be key for your financial and life goals. As we’ve seen, even half a percentage point can translate to a significant sum over the life of your loan. Here are some smart steps to take as you consider loan offers.
• Make sure you compare rates and fees from multiple lenders.
• Review each loan’s annual percentage rate (APR), which includes fees, closing costs, and mortgage points to give you a more complete picture of the loan’s costs.
• If you’re concerned about rates rising while you negotiate your closing, many lenders will let you pay a fee to lock in your rate for up to 90 days.
Hampton, Virginia has programs that can help you on your journey to homeownership, especially if you’re buying your first home or have limited financial means.
The Virginia Housing Development Authority is your go-to, offering a variety of low-rate mortgages and programs tailored to different needs. (Note that while for some you can only qualify as a first-time homebuyer, many others are open to repeat buyers.)
Consider the Conventional Home Loan, for instance, a 30-year fixed-rate loan for first-time homebuyers that asks for only a 3% down payment. Or look at the Conventional No Mortgage Insurance loan, which requires a slightly higher credit score but offers the possibility of not having to pay for mortgage insurance.
And let’s not forget down payment assistance programs: The Down Payment Assistance Grant, which provides first-time homebuyers with up to 2.5% of their loan amount to put toward their down payment. These are just a few of the tools at your disposal to make homeownership more attainable.
Closing Costs in Hampton
Closing costs typically range from 2% to 5% of the loan value. These costs could include loan origination fees, appraisal fees, and title insurance, to name just a few.
The average cost of a house in Hampton is about $267,000. Closting costs on a loan of $267,000 would be between $5,340 and $13,350.
When you’re comparing mortgage rates in Hampton, Virginia, make sure to consider closing costs to get a full understanding of your expenses. Shopping around for the best mortgage rates and negotiating terms can help you reduce your overall costs.
The Takeaway
The mortgage market in Hampton, Virginia is full of options, and by keeping an eye on current mortgage rates and exploring the various assistance programs, you can make the best decisions for your financial goals. Whether you’re a first-time homebuyer or an experienced homeowner looking to relocate, understanding the different types of mortgages and the factors that influence rates will enable you to make an informed decision. And comparing rates and terms from a variety of lenders can help you secure the best deal for you.
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
Predicting the trajectory of mortgage rates is tough, but keeping an eye on the 10-year Treasury Bond can give you an idea of where rates are headed. It may help to know that current predictions are for mortgage rates to stay relatively stable this year, and perhaps into 2026. Rather than looking to mortgage rates to determine the right time to make a move, consider your financial readiness and reason for buying.
Will mortgage rates ever go back to normal?
We may not see the record low mortgage rates of the Covid-19 pandemic again. In fact, rates are currently at what are considered moderate levels, which could be considered “normal.” Fannie Mae predicted early in 2025 that rates would remain relatively stable and end the year at about 6.30%.
Can you tell me how to lock in a mortgage rate?
After you have a loan offer with an interest rate you like, you can ask the lender to lock your rate. A rate lock typically lasts 30 to 60 days. It’s sometimes free but otherwise costs between 0.25% and 0.50% of your loan amount.
How do mortgage interest rates work?
Mortgage interest rates are the fees you pay to borrow money for a home purchase, expressed as a percentage of the loan amount. These rates can be fixed or adjustable. Fixed-rate mortgages retain the same interest rate for the entire loan term, which can protect you from rising rates and provide predictable monthly payments. Adjustable-rate mortgages (ARMs) have rates that can change after an initial fixed-rate period, meaning that your monthly payments may become less predictable.
SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.
*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.
¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article. Checking Your Rates: To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.
• Larger economic factors and your personal financial situation both influence the mortgage interest rates you’re offered.
• Fixed-rate mortgages have the same rate through the life of the loan, while adjustable-rate mortgages (ARMs) have rates that may change.
• Work on your credit score and debt-to-income (DTI) ratio to boost your chances of getting favorable rates.
• Look into state and federal assistance programs for help with down payment and closing costs.
• Use online mortgage calculators to get a rough idea of costs and to compare different offers.
Introduction to Mortgage Rates
If you’re considering purchasing your first home in Auburn, Massachusetts, understanding mortgage rates is key. This guide is designed to demystify mortgage rates and how they work, equipping you with the knowledge to land the most favorable rate possible. We’ll delve into the economic and personal factors in play, empowering you to make savvy decisions during your home-buying journey.
Where Mortgage Rates Come From
Mortgage rates in Massachusetts are influenced by a variety of factors. The mortgage rate you’re offered depends on the general economy and also on your individual financial situation and history.
Economic Factors Influencing Mortgage Rates
• The bond market has historically been the primary indicator of where mortgage rates are headed. That’s particularly true of the 10-year U.S. Treasury Note. When the rates on the note go up, mortgage interest generally rises, too.
• The strength of the housing market is key as well. When the housing market cools and more homes are available than there are buyers, lenders may lower rates to keep attracting customers.
• Inflation and unemployment also play a role in determining mortgage rates. Mortgage rates tend to rise when the economy is strong, reflecting the potential for increased demand for borrowing and potentially higher costs for lenders providing loans to consumers. A recession, on the other hand, usually means lower mortgage rates.
Borrower Factors Influencing Mortgage Rates
• Your credit score is a predictor of the mortgage rate you’ll be offered. The higher the score, the lower the rate you’ll likely get.
• The amount of your down payment plays a role. Making a larger down payment can result in a lower interest rate, since lenders often assume that if you have more equity in your new home, you’ll be less likely to default on your loan.
• Your debt-to-income (DTI) ratio is also important since lenders look at your income in relation to your monthly debts. Typically, mortgage lenders want to see a DTI ratio of no more than 36%, though that is not necessarily the maximum.
See what factors impact your mortgage.
See how different loan amounts, down payments, and other factors impact your home mortgage with our mortgage calculator.
See what factors impact your mortgage.
See how different loan amounts, down payments, and other factors impact your home mortgage with our mortgage calculator.
How Interest Rates Affect Home Affordability
Mortgage rates can make a big difference in the overall affordability of buying a home. Even a small difference in your rate can make a big difference in terms of your monthly budget and the total interest you’ll pay.
For example, if you take out a $400,000 fixed-rate 30-year home loan at a 6.50% interest rate, your monthly payment will be $2,528. But if that interest rate were just half a percentage point higher, at 7.00%, your monthly payment would be $2,661.
Looking at the whole life of the loan, over that 30-year mortgage, you would end up paying nearly $48,000 more in interest with the higher interest rate.
Auburn Mortgage Rate Trends
Diving into the historical context of mortgage rates in Auburn can provide valuable insights for people planning for a new home. While rates have seen a gentle rise in recent years, they’re still nowhere near the highest points in history. In fact, they’re currently hovering close to the 50-year average. Understanding the historical context of mortgage rates and the factors that influence them can help you make informed decisions about your home financing.
Historical U.S. Mortgage Rates
The history of mortgage rates in the United States is a story of ups and downs. Over the past 50 years, average yearly rates have fluctuated as low as 2.96% during the Covid-19 pandemic and as high as 16.63% in 1981. The graphic below shows just how volatile rates have been over the last half century.
Historical Interest Rates in Massachusetts
The chart below shows how mortgage interest rates in Massachusetts have compared to the national average during recent decades. (The Federal Housing Finance Agency stopped compiling this city-level data after 2018.)
You can see that rates in Massachusetts have risen and fallen along with national rates, but trend slightly lower.
Year
Massachusetts Rate
U.S. Rate
2000
7.88
8.14
2001
6.93
7.03
2002
6.38
6.62
2003
5.55
5.83
2004
5.38
5.95
2005
5.62
6.00
2006
6.32
6.60
2007
6.30
6.44
2008
5.96
6.09
2009
4.86
5.06
2010
4.76
4.84
2011
4.44
4.66
2012
3.63
3.74
2013
3.71
3.92
2014
3.94
4.24
2015
3.71
3.91
2016
3.54
3.72
2017
3.86
4.03
2018
4.33
4.57
Source: Federal House Finance Agency
Should You Wait for Interest Rates to Drop?
If you’re buying your first home in Auburn, you might be asking yourself if you should wait for mortgage rates in Massachusetts to dip.
Here’s what you should know: As of early 2025, predictions from Fannie Mae indicate that rates will likely hold more or less steady, hovering around 6.30% by the year’s end and about 6.20% when 2026 draws to a close.
Remember, too, that if you buy a house and rates go down in the future, you have the option to get a mortgage refinance to take advantage of the change.
How Costs Stack Up in Auburn
Based on its cost of living, Auburn is among the more affordable cities in Massachusetts, though it’s still a bit above the national average. The cost of living in your city can have a major influence on your financial planning, since it has an impact both on home prices and on how easily you’ll be able to budget for your monthly mortgage payments.
Here’s how Auburn compares to other towns in Massachusetts on an index where 100 equals the average cost of living in the U.S.
Consider taking these steps to help you get the best mortgage rates that you can.
• Check your credit score. If it’s lower than you’d like, plan to work on building a stronger credit history.
• Reduce your debt-to-income (DTI) ratio. Paying down as much debt as you can will help.
• Increase your down payment. You can use savings and gifts contributed by friends and family to boost the amount.
• Coompare rates from multiple lenders. Even before you reach out to lenders, you can look at mortgage rates online in Auburn, MA to focus your search.
• Think about going through the mortgage preapproval process. This will give you a better sense of what you can afford.
Tools & Calculators
Online mortgage calculators are a great way to get an estimate of your monthly payments and total costs. These tools can help you understand the impact of interest rates and loan terms on your budget, and let you see how changing components — like the length of your loan — change your financial commitments.
Using the free calculators is for informational purposes only, does not constitute an offer to receive a loan, and will not solicit a loan offer. Any payments shown depend on the accuracy of the information provided.
Types of Mortgages Available in Auburn
In Auburn, you’ll find that lenders provide many types of mortgage loans to homebuyers. Conventional mortgages are the go-to for many, typically requiring a credit score of 620 or above. Like many other home loans, conventional mortgages can be either fixed-rate, with unchanging monthly payments, or adjustable-rate mortgages (ARMs), which have rates that can shift over time.
Additionally, don’t forget about government-backed loans, like FHA and VA loans. These can be game-changers, accepting smaller down payments and lower credit scores.
Fixed-Rate Mortgages
Fixed-rate mortgages provide you with a consistent interest rate throughout the loan term. This structure ensures stable and predictable monthly payments, making it easier to budget. These mortgages are most commonly available in terms of 15 or 30 years, but other terms may be possible, providing a variety of options suited to different financial situations. For first-time homebuyers concerned about avoiding unexpected costs, a fixed-rate mortgage can be particularly beneficial.
Adjustable-Rate Mortgages (ARMs)
Adjustable-rate mortgages (ARMs) typically start with a lower interest rate than fixed-rate mortgages. After a defined period, however, the interest rate adjusts regularly in accordance with market conditions, so your payments can fluctuate. This could work in your favor if market rates drop, but there’s also the risk of rates rising. For homebuyers who are planning to move before the initial low-interest rate period is over, an ARM can be a strategic choice. But it’s wise to be sure of your plans so you don’t end up facing higher payments than you anticipated down the road.
FHA Loans
Supported by the Federal Housing Administration, FHA loans are known for having less demanding eligibility criteria than conventional loans. With a minimum down payment requirement of just 3.5% and often more flexible credit terms, they’re a popular choice for first-time homebuyers. These loans do require a mortgage insurance premium (MIP). In Auburn, where the cost of living is on the higher side, FHA loans can be the key to unlocking homeownership.
VA Loans
VA loans are available to eligible active-duty military members, veterans, reservists, National Guard members, and some surviving spouses. The most significant advantage of a VA loan is that it doesn’t require a down payment, making it an attractive option for anyone who may not have a large amount of cash to put down. Additionally, VA loans don’t expect borrowers to obtain private mortgage insurance (PMI), which can save you a significant amount of money over the life of the loan.
Jumbo Loans
In most areas, including Auburn, conventional mortgage loans have a 2025 cap of $806,500 for a single-family home. Jumbo loans are designed for properties exceeding this limit, offering flexibility for high-value homes and larger purchases. These loans often come with higher interest rates and stricter qualification criteria; however, they can be a good option for those with strong financial profiles seeking to buy expensive properties.
Current mortgage rates by state.
Compare current home interest rates by state and find a mortgage rate that suits your financial goals.
Select a state to view current rates:
How to Evaluate Loan Offers in Auburn
Let’s look at how to make your decision once you’ve got loan offers.
A competitive mortgage rate is your ticket to long-term savings. Even half a percentage point can add up to thousands of dollars over the loan’s life, as we’ve seen.
But rates are not the whole story. Also compare each potential loan’s annual percentage rate (APR), which is an all-in-one number that factors in fees, closing costs, and mortgage points.
Once you’ve decided, if you’re losing sleep over rising interest rates, many lenders will let you pay a fee to lock in your rate for up to 90 days.
Massachusetts has resources and programs to aid house hunters, especially those who are first-time homebuyers or have limited financial means.
The state’s initiatives, such as My Mass Home’s ONE Mortgage (for which you can only qualify as a first-time homebuyer) and MassHousing Loan, are designed to offer low-interest, fixed-rate loans with down payments as minimal as 3% or 5%. They also provide down payment assistance programs.
Federal programs like FHA loans and VA loans are also in the mix, providing low down payments and flexible credit requirements.
Closing Costs in Auburn
If you’re getting ready to settle down in a new home in Auburn, it’s a good idea to be prepared to cover 2% to 5% of your loan amount in closing costs. These costs can vary based on the property’s value and location, and they typically include charges such as loan origination fees, appraisals, and title insurance.
The average cost of a house in Auburn is about $453,000. For a loan of that amount, closing costs typically run between $9,460 and $23,650. To keep these expenses in check, it’s a smart move to explore different lenders and negotiate terms.
The Takeaway
Auburn, Massachusetts’s mortgage landscape features a range of options for prospective homebuyers. By staying informed about current mortgage rates in Massachusetts and exploring available assistance programs, you can make well-informed decisions that align with your financial resources and goals. Whether you’re a first-time buyer, a veteran, or a high-income earner looking to purchase a prestige property, there are resources and loan types available that can help you secure the best possible rate and terms for your mortgage.
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
Will mortgage rates drop in Auburn, Massachusetts?
While it’s tricky to pinpoint the exact trajectory of mortgage rates, current predictions from Fannie Mae suggest that rates will stay fairly stable through the end of 2026. That said, if you work on strengthening your credit history, paying down your debt, and saving up a larger down payment, you may be offered a better rate by lenders.
Will mortgage rates ever go back to normal?
History shows us that mortgage rates have been all over the map. However, right now they’re actually in the range of the 50-year average, and Fannie Mae has predicted that they will hold relatively steady, ending 2025 at about 6.30%.
How can you secure a mortgage rate?
After you’ve been offered a rate you like but before you’ve closed on your new home, it can be a good move to lock in your mortgage rate. You can ask your lender for a rate lock, which may involve a small fee and guarantees your rate for up to 90 days. That way, even if your closing is delayed a little, your rate won’t go up.
How do mortgage interest rates function?
Mortgage interest rates are essentially the charge you pay your lender in order to borrow money to purchase a home. Interest rates are often expressed as a percentage of the loan amount. You’ll find two main types of rates: fixed and adjustable. Fixed-rate mortgages provide a consistent interest rate over the loan term, while adjustable-rate mortgages (ARMs) can start at a lower fixed rate, but after that initial period, their rates may fluctuate.
SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
SoFi Mortgages
Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.
*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency.
†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article. Checking Your Rates: To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.
