Government-backed loan programs could get you better terms.
New York has some of the highest closing costs and some of the most expensive real estate in the country. To help you save, find out if you qualify for government-backed or Veterans Affairs (VA) loans or if you can get help with your down payment from the State of New York Mortgage Agency (SONYMA).
Mortgage lenders in New York
When choosing a mortgage lender, consider the interest rate, closing costs and if they offer government-backed products such as FHA or USDA loans. These can help you get better terms — especially if you’re a first-time homebuyer or if you’re applying for a home in a rural or suburban area.
Mortgage lenders for veterans in New York
If you’re a veteran, active service member or eligible spouse, you could get lower interest rates, lower down payment options, no mortgage insurance and other beneficial perks with the VA home loan program.
How to find the lenders and rates in New York
See if you qualify for one of the government- or VA-backed loans. If you do, compare lenders in New York that offer these programs. And always compare interest rates, down payment options, closing costs, customer service and whether you’d like to apply online or in person.
What to consider when looking for a mortgage in New York
If you’re a first-time homebuyer, consider looking into SONYMA. This government-backed program could make it possible to get a 30-year fixed rate that you can combine with other grants and subsidies. You can also apply for a 0% down payment loan for a minimum of $1,000 and a maximum of $3,000 or 3% of the purchase price (maximum $15,000), whichever is higher. This loan requires no monthly payments and it’s forgiven after 10 years.
Credit unions are another option, as they typically offer lower interest rates and charge lower fees than banks. They’re also more likely to offer loans to individuals with lower income than conventional banks.
Closing costs in New York
Be ready to pay the second-highest closing costs in the country, especially if you want to buy a home in the city. The median home sale price in New York is between $400,000 and $500,000. After taxes, you could pay $15,254 in closing costs on average.
If you’re buying a home for $1 million or more, you’re subject to a 1% New York City mansion tax. That’s an additional $10,000 on a $1 million home.
Bottom line
First-time home buyers could get benefits from the State of New York Mortgage Agency. If you qualify, you could also consider government- or VA-backed programs. But always compare the interest rates, closing costs and down payment options of other mortgage lenders before making a decision.