I still remember the cases of two buyers I consulted a few years ago. One had a credit score of 782, while the other had a score of 705. Both were looking for homes in Cambridge around the same time and price range, but their final interest rates ended up being 6.59 percent and 6.91 percent, respectively. Given the large loan amounts, this 0.32 percentage point difference can accumulate to tens of thousands of dollars in interest over 30 years.

The housing prices in Cambridge vary significantly depending on the source. According to Zillow, the average is $1,044,286 (as of June 30, 2026, a 1.5 percent decrease from the previous year), while other sources report a median price of $1,309,000. Even within the same city, areas like Harvard Square and North Cambridge can have vastly different conditions, so it's essential to check the market prices by neighborhood when viewing properties.

Starting with loan types, FHA loans require a 3.5 percent down payment for credit scores of 580 or higher, and a 10 percent down payment for scores between 500 and 579. Conventional loans can start at 3 percent for first-time homebuyers or those with an area median income of 80 percent or less, with the usual down payment being 5 percent. If the down payment is less than 20 percent, PMI will apply, while it is waived for 20 percent or more. In a high-priced market like Cambridge, the PMI costs can add up, so it's wise to calculate them in advance.

As mentioned earlier, interest rates are divided by credit score ranges: 6.59 percent for scores above 780, 6.66 percent for the 760s, 6.75 percent for the 740s, and 6.91 percent for the 700s (as of early July 2026). The overall average is around 6.6 percent (between 6.55 and 6.72 percent, Freddie Mac PMMS). Checking your credit report for errors before pre-approval is the most reliable way to lower your interest rate.

Documents for pre-approval typically include proof of income for the last two years, two months of bank statements, pay stubs, and identification, along with a review of DTI. Closing costs should be prepared at 2 to 5 percent of the loan amount, and in a market like Cambridge where loan amounts are substantial, it's important to calculate cash flow in advance. Fixed-rate loans are suitable for those planning to stay long-term, while ARMs are better for those who may move within five years.

The average effective property tax rate in Massachusetts is 1.11 percent (based on a median home value of $525,800, resulting in an annual tax of $5,813), but Cambridge has its own residential tax rate, so be sure to check both the Middlesex County and Cambridge city rates. Down payment assistance is available through MassHousing's standard program, offering up to $30,000, with income limits set at 135 percent of the area median income. The temporary interest-free $25,000 expansion program ended on July 2, 2026.

The school district is consistently mentioned in GreatSchools ratings, leading to inquiries from Korean families. However, school district boundaries change frequently, so it's advisable to verify assigned schools before signing a contract.

When making an offer, it's common to deposit 1 to 3 percent of the purchase price as earnest money. In a competitive market like Cambridge, this amount can signal the seriousness of the offer. During the 7 to 10 days of the home inspection period after the contract, it's common to find issues with plumbing, electrical, and roofing in older buildings, so it's wise to leave room for renegotiation at this stage. It's also not uncommon for appraisals to come in below the contract price, so you should calculate in advance whether you can cover the difference in cash. I want to emphasize again that even a few points difference in credit scores, like the cases of 782 and 705, can significantly impact the interest costs over the life of the loan. This article does not constitute investment or legal advice, and I recommend consulting a professional before finalizing any contracts.