Financing a purchase here: the process, not the rates

Every published rate is stale by the time you read it, and no article can tell you what you will be offered. What does not move is the sequence: what a lender checks, in what order, and which contract date can cost you a deposit.

Pre-qualification, pre-approval and commitment

All three words get used loosely, including by lenders, and they are worth very different things in an offer.

Pre-qualification is a lender's opinion based on what you told them. Nothing is verified, and a listing agent reads it as an intention rather than a capability.

Pre-approval should mean credit pulled, income and assets documented, and the file reviewed. The term is not defined in law and lenders use it differently, so ask yours in writing whether an underwriter has actually reviewed your file or whether a loan officer ran the numbers. Some will underwrite you fully in advance, leaving only the property outstanding. That is the strongest letter you can carry.

Commitment arrives after the lender has underwritten the property as well as you: appraisal in, title reviewed, conditions cleared. It is the only one of the three that is an obligation by the lender, and even it carries conditions.

When you write, hand over a letter that is recently dated, matches the price and terms you are offering, names the loan program, and comes from someone who answers the listing agent's call on a Sunday.

What underwriting actually examines

An underwriter answers four questions: can you repay, will you keep being able to, do you have the cash you say you have, and is the property adequate security. The first three are about you and are largely settled at pre-approval. The fourth is about the house.

On income, the test is documentation and likelihood of continuing, which is why self-employment, bonus and commission income need a history rather than a good month. On assets, it is sourced and seasoned: a large deposit appearing without explanation becomes a condition, and gift funds need a letter and a trail.

A conditional approval with a list of outstanding items is normal, not a warning. What matters is the clock: every document returned late moves your commitment date, and that date is contractual. Employment is usually reverified in the final days, so do not change jobs, open credit or move money while a file is open.

Two federal deadlines shape the calendar. You must receive a Loan Estimate within three business days of applying, and a Closing Disclosure at least three business days before the loan closes. The second is a waiting period, not a delivery target: a late change to the loan product or the APR can restart it and push a closing everyone else has planned around.

The appraisal, the gap, and who carries it

The lender orders the appraisal, the appraiser works for the lender, and you generally pay for it. The lender lends against the lower of purchase price or appraised value, so a low appraisal does not change the price you agreed; it changes how much of it the lender will fund.

The difference is the gap, and it closes three ways: the seller reduces the price, you bring the difference in cash on top of the down payment, or the deal ends. Which is available to you was decided in your offer, before anyone knew the number, by whether you kept an appraisal contingency, agreed to cover a gap up to a stated amount, or waived it. Waiving is a cash commitment, not a formality.

An appraisal can also come back "subject to" a repair, a certificate or a completion, requiring the appraiser to return: a timing problem as much as a money one. If you believe it used poor comparable sales, lenders have a reconsideration-of-value process; ask what yours accepts as evidence.

The commitment date is the real deadline

In the standard Massachusetts forms, the mortgage contingency runs to a commitment date negotiated by the parties with the closing date in mind. The form also requires you to apply promptly, within a short stated period, and to use diligent efforts.

Without a written commitment by that date, you generally must give written notice, received by a stated time, to terminate and recover your deposit. If notice is not given, the contingency is commonly deemed waived, and from that moment your deposit rides on a loan you do not have. Extensions require the seller's written agreement, so ask days early rather than hours late.

Forms vary and attorneys edit them. Read the wording in your own contract, with your own attorney, and diary the dates the day you sign.

Loan types, by what they demand of the property

Loan programs are usually explained by who borrows them. That framing is both legally fraught and practically useless. What decides whether a loan works on a particular house is what the program demands of the house.

Program family	What it demands of the property
Conventional, sold to the secondary market	The appraiser rates condition, and the property must be habitable and structurally sound. Repairs can be required, but these standards accommodate older housing stock best
FHA	Minimum property requirements: working heat, potable water, functioning sewage disposal, sound roof, no observed hazards. Wells and septic systems must meet separation and water-testing rules. Strict on deteriorated paint in pre-1978 housing
VA	Its own minimum property requirements, including a water test where the supply is a private well
USDA guaranteed	The property must sit inside a designated eligible area and meet the program's condition standards; well and septic evaluations are the norm
Renovation loans	They fund the repairs, but demand a defined scope, contractor bids, a draw schedule and inspections. Budget weeks, not days
Condominium financing	The lender underwrites the association as well as the unit: budget, reserves, insurance, owner-occupancy, litigation. A sound unit can fail on its project

Read that against what is for sale here. A 1918 farmhouse on a private well with a roof near the end of its life is a different financing problem from a 2015 colonial on town water, and the question belongs to your lender before you write, not after the appraisal. The controlling detail lives in the agencies' handbooks and selling guides, which are revised regularly, so ask which one governs your file and what it requires of this house. A house not yet built is its own case: see what a new-construction buyer checks that a resale buyer never has to.

Septic and well condition can be a lender requirement rather than a preference, which makes what a Title 5 inspection covers and what a failure actually means a financing question too. Your own inspection is separate from all of it: where a general inspection's regulated scope ends explains why the lender's view of a house and your inspector's can differ sharply.

Programs exist; their numbers do not hold still

There are more kinds of help than most buyers realise: state agency mortgages with a companion down payment assistance loan, a state-backed low-down-payment mortgage offered through participating lenders, grant programs that open and close as funding allows, and municipal or regional first-time buyer funds.

This page carries no figures, because income limits, price caps, assistance amounts and interest terms are set annually and can change, or close to new applications, mid-year. Anything quoted here would be wrong within a quarter. Get current terms from MassHousing and the Massachusetts Housing Partnership directly, and from your town or regional housing agency, and confirm your lender participates before you rely on a program in an offer.

One thing does not change: a lender may not make a credit decision on the basis of a protected characteristic. If a decision goes against you, ask for the written adverse action notice.

Where to start

Get underwritten, not pre-qualified. Ask what your program demands of the kind of house you intend to buy. Diary the commitment date the day you sign, and treat every document request as urgent. The rest of the sequence is on the buyer's guide to this market and its public records; for a second opinion on whether a house and a loan fit each other, talk it through with Tim Harvey.