How to Buy a Home at 2.75% in a 6.5% World: The Complete Guide to Assumable Mortgages in Greater Boston

Assumable mortgages allow you to take over a seller's existing FHA or VA loan at their original interest rate (often 2.5%-3% from 2020-2021) instead of getting a new loan at today's 6.5% rates. On a $500,000 loan, this saves $1,050/month or $378,000 over 30 years. But in Greater Boston's appreciated market, you must pay the seller cash for their equity—creating a $150,000-$300,000 'gap' between the loan balance and purchase price. Conventional loans are NOT assumable. Only government-backed FHA and VA loans qualify. Anyone can assume an FHA loan (but inherits lifetime mortgage insurance). Civilians can assume VA loans (but the seller's entitlement gets locked). Timeline: 60-120 days vs 30-45 for conventional. Best opportunities: Quincy, Worcester, Randolph, Brockton, and near Hanscom AFB (Bedford, Lexington). You need significant cash reserves, HELOC, family gifts, or creative financing to bridge the gap.