Mortgage Options and Rates for Maryland Buyers in 2025

by David J. Moore

Understanding Today’s Mortgage Landscape in Maryland

If you’ve been dreaming about owning a home on Maryland’s Eastern Shore — whether it’s a cozy cottage in Stevensville, a waterfront retreat in Chester, or a family home on Kent Island — 2025 may be your year to make it happen.

But before you start house-hunting, it’s essential to understand your mortgage options and what today’s rates mean for your buying power. The mortgage market in 2025 is shaped by a mix of lower inflation, steady demand, and a slowly stabilizing economy. For many Maryland buyers, that translates into more flexibility and opportunity when financing a home.

Let’s explore what that looks like — and how you can position yourself for the best possible mortgage.

The Current State of Mortgage Rates in 2025

Mortgage rates have been on a bit of a rollercoaster the past few years. After the rate hikes of 2022–2023, things are finally easing up. As of fall 2025, average 30-year fixed mortgage rates in Maryland hover around the mid-6% range, while 15-year fixed options are closer to the low 6s — depending on credit, income, and loan type.

That might not sound like the record-low rates of the early 2020s, but they’re much more manageable than just a year or two ago. More importantly, lenders are becoming more competitive again — offering flexible programs, temporary rate buydowns, and special incentives for first-time buyers and local residents.

On the Eastern Shore, where home prices tend to be more affordable than areas like Annapolis or Baltimore, these rate adjustments can make a huge difference in monthly payments and long-term affordability.

Popular Mortgage Options for Eastern Shore Buyers

1. Conventional Loans

These remain the most common mortgage option in Maryland. Backed by Fannie Mae and Freddie Mac, conventional loans are ideal for buyers with good credit and a solid down payment (usually 3–20%).

Example: If you’re buying a $450,000 home in Chester and putting down 10%, your monthly payment with a 6.5% interest rate would be roughly $2,500 before taxes and insurance — a very manageable number for many dual-income families.

2. FHA Loans

For first-time buyers or those rebuilding credit, FHA loans are a strong option. They require as little as 3.5% down, and the credit score requirements are more forgiving.

FHA programs are especially popular among younger professionals moving to Kent Island or Stevensville, where starter homes and condos are in high demand.

3. USDA Loans (Rural Development Loans)

Many parts of Maryland’s Eastern Shore — including portions of Queen Anne’s County — qualify for USDA loans, which offer zero down payment and low-interest rates.

These are designed to encourage homeownership in rural and semi-rural areas, and the Eastern Shore fits that description perfectly. For qualified buyers, a USDA loan can be a fantastic way to own a home with minimal upfront costs.

4. VA Loans

If you’re a veteran, active-duty service member, or eligible spouse, VA loans are an incredible benefit. They offer no down payment, no private mortgage insurance (PMI), and highly competitive rates.

Given Maryland’s proximity to several military bases, including Fort Meade and Andrews Air Force Base, this is a very relevant option for local buyers.

5. Adjustable-Rate Mortgages (ARMs)

While not as common as fixed-rate loans, ARMs can be appealing in 2025 for buyers who plan to sell or refinance within 5–7 years. The initial rate is typically lower than a 30-year fixed, helping reduce payments during the early years of ownership.

For example, a 5/1 ARM might start around 5.9%, saving you several hundred dollars per month — a smart move if you plan to upgrade or relocate within a few years.

How to Choose the Best Mortgage Option

The right mortgage depends on your goals, budget, and how long you plan to stay in your home. Here are a few tips for buyers across Kent Island, Stevensville, and Chester:

Work with a local lender. They understand Maryland-specific programs, closing cost assistance, and local property tax structures.
Get pre-approved early. Pre-approval helps you know your true price range and gives you a stronger position when making an offer.
Compare at least three lenders. Rates can vary — even a 0.25% difference can save you thousands over the life of your loan.
Ask about incentives. Some lenders offer closing cost credits or temporary rate buydowns (such as a 2-1 buydown), which can ease the first couple of years of payments.

Local Insight: Why Timing Still Matters

Many buyers hesitate, thinking rates might drop even lower. But here’s the truth: waiting often costs more.

While rates might dip slightly, home prices on the Eastern Shore continue to rise — particularly in sought-after communities like Bay City, Cloverfields, and Romancoke on the Bay. A small decrease in interest rates rarely offsets a $20,000 or $30,000 jump in home prices.

By locking in your home now, you can refinance later if rates improve — but you can’t turn back the clock on today’s prices.

How Our VIP Buyer Program Helps You Win

At David J. Moore & Associates, our VIP Buyer Program is designed to help you make smart, confident moves in this market.

When you join our program, you’ll receive:

Priority access to new listings before they hit Zillow or Realtor.com
Exclusive lender connections with competitive rates and local expertise
Home Buyer Concierge service to guide you from pre-approval to closing
Personalized property alerts tailored to your budget and lifestyle goals

We’ll help you match your dream home with the best financing — whether that’s a low-down-payment FHA loan or a competitive fixed-rate conventional mortgage.

Final Thoughts: The Path to Homeownership in 2025

Buying a home in Maryland doesn’t have to feel overwhelming — not when you have the right team and tools behind you.

Whether you’re a first-time buyer eyeing a condo in Stevensville, a growing family looking for space in Chester, or a retiree dreaming of an Eastern Shore waterfront view, there’s a mortgage option that fits your vision and budget.

Now is a great time to take that first step toward homeownership — and we’re here to guide you every step of the way.

👉 Ready to buy? Contact David J. Moore & Associates at 410-733-6477 or visit ChesapeakeShoresRealtor.com to learn more about our VIP Buyer Program and start your journey toward owning your dream home on Maryland’s Eastern Shore.