Buying a home today can feel overwhelming, especially when prices seem to rise faster than the ability to save. Whether you’re shopping in competitive markets like Andover or North Andover, MA, or anywhere else in the country, the truth is the same: houses are expensive. But here’s the good news—your choice of mortgage can significantly shape how affordable homeownership feels, not just on closing day but for years to come.

Below, we break down how choosing the right mortgage can help you manage today’s housing costs and even save thousands over the life of your loan.

Why Mortgage Choice Matters More Than Ever

With the median home price continuing to climb across Massachusetts, buyers need every tool available to balance affordability and long-term financial health. Your mortgage type affects:

• Monthly payment size

• Interest costs over time

• How quickly you build equity

• Your ability to refinance later

• Your overall financial flexibility

The right mortgage won’t make a home “cheap”—but it can make buying much more manageable.

Mortgage Options That Can Help Make Homeownership More Affordable

1. Fixed-Rate Mortgage: Stability in an Uncertain Market

Fixed-rate mortgages lock in your interest rate for the entire loan term—typically 15 or 30 years.

Why It Helps:

• Predictable monthly payments

• Protection if rates rise

• Easier long-term budgeting

Best For:

Buyers who plan to stay in their home long-term and want payment stability.

Example:

If you lock in a 6% rate today and rates rise to 7.5% next year, you’re insulated from those increases for the life of your loan.

2. Adjustable-Rate Mortgages (ARMs): Lower Initial Payments

ARMs start with a lower interest rate for the first 5–10 years, then adjust periodically.

Why It Helps:

• Lower initial monthly payments

• Can help buyers qualify for more home

• Ideal for short-term homeowners

Example:

A 5/6 ARM at 5.1% vs. a 30-year fixed at 6.2% could save you hundreds per month in the early years.

This option may work well if you expect to move again or refinance before the adjustment period.

3. 15-Year Mortgage: Higher Payment, Huge Interest Savings

A 15-year mortgage builds equity faster and significantly reduces total interest paid.

Why It Helps:

• Often comes with a lower interest rate

• You own your home twice as fast

• You save tens of thousands of dollars in interest

Example:

On a $600,000 home in Andover with 20% down:

• 30-year mortgage at 6.2%: about $2,946/mo (principal + interest)

• 15-year at 5.4%: about $3,915/mo
  But… you save over $270,000 in interest.

If affordability allows, this is one of the best wealth-building mortgage choices.

4. FHA Loans: Smaller Down Payments

FHA loans allow down payments as low as 3.5%, making homeownership more accessible.

Why It Helps:

• Lower upfront cash needed

• More forgiving credit requirements

• Can get you into the market sooner, helping you start building equity

Potential Trade-Off:

You’ll pay mortgage insurance for at least 11 years, sometimes for the entire loan term.

5. MassHousing and First-Time Buyer Programs

Local Massachusetts programs can reduce upfront and ongoing costs.

These programs may offer:

• Down payment assistance

• Lower interest rates

• Reduced mortgage insurance costs

In high-cost towns like North Andover, these programs can make a meaningful difference for first-time buyers.

6. Buying Points: A Strategy for a Lower Rate

“Buying points” means paying upfront to reduce your interest rate.

Why It Helps:

• Can lower your monthly payment for decades

• Makes sense if you plan to stay in the home long-term

Example:

Paying 1 point = 1% of the loan amount
On a $500,000 loan, one point costs $5,000 and could lower your rate by 0.25%, saving you thousands over time.

7. Considerations for High-Price Markets Like Andover

Andover and North Andover buyers deal with:

• Above-average home prices

• High competition

• Limited inventory

That makes smart mortgage planning even more important.

A small rate difference—like 0.5%—can shift your monthly payment by hundreds of dollars.
Choosing the right mortgage can be the difference between stretching your budget… and feeling comfortably within it.

So, Can Your Mortgage Choice Help? Absolutely.

While no mortgage can erase the reality of today’s pricing, the right loan type can make homeownership far more attainable and sustainable.

Here’s how to approach it:

- Compare mortgage types

Run payment estimates for fixed, ARM, 15-year, FHA, and first-time buyer programs.

- Consider your timeline

How long you plan to stay in the home affects which loan is best.

- Think beyond the monthly payment

Interest savings, refinancing options, and equity-building speed all matter.

- Work with a trusted local lender

Local experts understand the nuances of the Andover/North Andover market and can match you with the most cost-effective loan structure.

Houses may be expensive today, but your mortgage choice is one of the most powerful tools you have for making a home purchase financially manageable.
With the right strategy, you can lower your monthly payment, reduce your long-term costs, and build equity faster—even in competitive Massachusetts markets.

If you want help understanding mortgage choices as a buyer or seller in Andover or North Andover, I can guide you step-by-step.

Matt Witte strives to be the best realtor in North Andover, MA.

Any questions about real estate, reach out to Matt Witte, North Andover Realtor, MA-