First-Time Homebuyer

First-Time Homebuyer

take a closer look at buying your first home.

What you should know before your big purchase and loan.

First-Time Homebuyer

take a closer look at buying your first home.

What you should know before your big purchase and loan.


We’ve got your back on the path to home sweet home.

Buying your first home is a significant, exciting milestone. We understand how monumental this decision can be, so that’s why we’ll work together to guide you on your way.

Take a closer look at your team.

  • You.

    You’re the star of the show, so ask any and all questions, and expect a lot of communication as your lender and agent work to ensure your best interest comes first.

  • Your lender.

    With us, expect a pre-approval in as little as 3 minutes, an application that’s 100% online, and a team of experts here to provide you with personalized guidance.

  • Your real estate agent.

    Beyond finding a home, agents act as a liaison between you and the seller helping with important details like price negotiations, paperwork, and closing.

The journey to homeownership.

Know the steps to expect from pre-approval to keys in hand.

Home loan pre-approval

Home loan pre-approval.

First, before touring homes, it’s important you get pre-approved so you know just how much house you can afford. With us, pre-approval takes as little as 3 minutes. Once complete, you’ll receive a personalized quote and a pre-approval letter to show sellers, which can put you in a stronger negotiating position when it’s time to make an offer. For qualification, we take a few factors into consideration.


Down payment.

Though a higher down payment shows less risk and could mean a lower rate, with us you can put down as little as 5% when you pay private mortgage insurance, or, for eligible borrowers, just 3% with the HomeReady® mortgage program.

Credit score.

Factors like payment history and age of credit determine your score. To preserve your score, try to avoid new credit inquiries right before house hunting and through the closing of your loan.

Debt-to-income ratio.

Your total monthly debt payments divided by your gross monthly income. The lower your ratio, the more financing options available to you. It may be a good idea to follow the 28/36 rule.

Employment history.

We want to make sure you’ll be able to afford your home, so it’s important to provide information on your job history and proof of income.


Shop and make an offer

Shop and make an offer.

Next up, the fun part. With your budget determined and pre-approval letter in hand, it’s time to tour homes to your heart’s delight. You’ll want to make sure you ask plenty of questions  to get a good understanding of each property you see. 

 

When you’ve found the one, your agent can help you make an offer. At this point, there are a few fees and costs to keep in mind.


Deposit fee.

Known as earnest money, most buyers typically put down about 1 to 3% of the sale price for the offer. If the contract falls through, this amount may be refundable, depending on the contract.

Inspection fee.

After the offer’s accepted, it’s a good idea to get an inspection. If there are issues, you may be able to ask the seller to fix, pay for repairs, renegotiate the sale price, or even cancel the contract. Inspections usually cost around $300 or more.

Other recurring monthly costs.

In addition to your mortgage payment, sudden repairs and standard upkeep can add hundreds. Plus, don’t forget HOA fees, taxes, and insurance, which in some cases you’ll pay through an escrow account.


If your offer’s accepted, you’re one step closer. If it’s rejected, don’t lose heart. You may be able to offer again, but your agent can help determine if that’s in your best interest. Keep in mind, you can easily edit your digital pre-approval letter, no loan officer needed, to make new offers in a flash.

Mortgage rate lock and home appraisal.

Mortgage rate lock and home appraisal.

Once your offer’s accepted, return to your online application, upload the signed purchase agreement, and lock your rate. This sets mortgage processing in action, plus it provides peace of mind your rate is guaranteed. Next, we’ll start the home appraisal process.


Pay the $550 appraisal fee.

We’ll let you know when it’s time to make your payment online. If it ends up costing less, we’ll refund you, and if it’s more, we’ll cover anything additional. 

We’ll schedule it.

No need for you to do anything at this point. We'll set up the appointment, introduce you to the third-party appraisal company, and they’ll go in and review the property.

Determine next steps.

Since we can’t loan more than a property’s worth, if the appraisal’s below purchase price, you’ll need to renegotiate, pay the difference, or back out and see if the price drops. If it’s at or above purchase price, you’re in the clear and ready to move to underwriting.

Underwriting

Underwriting.

You’re getting closer to home. In this step we’ll work with you toward finalizing the loan.


Complete your application.

Log in at any time to see what information we still need from you on our clearly displayed “to-do list.” Work at your own pace to upload, sign, and submit documents. We may ask for the following:

  • Most recent pay stubs and proof of other income or assets

  • Employment records

  • Letter of explanation for gaps in employment greater than 30 days

  • Bank, retirement, and brokerage account statements

  • Tax returns

  • Divorce decree

  • Social Security number

  • Proof that you paid any judgements/liens in full

  • Landlord information to verify rent payments


We'll review.

Our underwriting team will review everything you sent us, conduct additional credit checks, and make a final decision on your loan. Though this can take a few weeks, we’ll notify you each time you have new tasks to review so you can log in and keep up to date on the status of your loan.

Closing on your home

Closing on your home.

Finally, you’re in the home stretch. Once your loan’s confirmed, we’ll send you a Closing Disclosure. After reviewing, you’re ready to settle everything in person on closing day.


Who.

You’ll meet with your real estate and closing agents, and, depending on your state, a lawyer, the seller, or the title company may join, too.

What.

You’ll pay 3% + of purchase price for the down payment, typically 2 to 5% of purchase price for closing costs, and homeowners insurance, which varies, but averages $1,200 annually. Keep in mind, earnest money may count toward your payment, and paying points or receiving credits also impacts your closing cost amount.

Where.

Typically you’ll meet at the attorney's office, the office of the title or escrow company, or some other agreed upon location.

When and how.

We’ll ask you to confirm you’ve paid for homeowners insurance during underwriting. For closing costs and down payment, most closing agents will have you pay by wire or cashier’s check. They’ll let you know specifically how much, when, and how to pay.


Review and sign your closing documents, then take a big sigh of relief – you did it! Take it all in as you receive the keys to your very first home.

Follow our home costs checklist.

Put your money where your house is.

One-time costs

This table shows anticipated home expense types as well as the estimated one-time cost for each.
Expense Type Estimated Cost
Down payment 3% + of the purchase price
Closing costs ~ 2 to 5% of the purchase price
Appraisal fee $550 maximum (with us)
Inspection fee ~ $300

Ongoing monthly costs

This table shows anticipated home expenses as well as the approximate ongoing monthly cost for each.
Expense Approximate Cost
Mortgage payment Varies
Property taxes ~ $100 to $200
Homeowners insurance ~ $100
HOA fee, if applicable $100 - $700
Utilities ~ $400
Private mortgage insurance, if applicable Based on loan amount
Maintenance and repairs Varies per month

Keep in mind, the costs we provide are averages and estimates. Costs vary depending on your location, the home you select, and your specific loan.

 

Learn more about the costs of homeownership

 


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