First-time homebuyers paradise

We know the home buying process is overwhelming — because we’ve been there too! Here, you will find all the information you need for buying your very first house (or condo, or townhome), from the open house to the closed loan. Check out:

Mortgage process overview: steps one through done.

  1. Pre-qualification first. Dream home second.
    Before you start house shopping, get pre-qualified for a mortgage. You’ll share details about your income, savings and credit score with your mortgage lender, who will then give you a pre-qualification letter showing how much they can lend — and how much home you can afford. Give that letter to your real estate agent so they can submit it with your offer to the seller when the time comes.
  2. Find the right home
    The first step is to be realistic. It's okay to be picky, but your expectations need to align with your budget. List out the must-have vs. nice-to-have features. When you walk through homes, look high and low, investigating everything you can. Flush toilets. Turn on faucets. Even test the microwave. Keep detailed notes and take lots of photos and videos with your phone.
  3. Make an offer
     Once you’ve found the right home, act fast. Work with your agent to submit an offer ASAP. Your agent will present the offer to the seller’s agent; they’ll either accept or counter-offer. From there, you can accept, counter or call it quits. You might be competing with other buyers making this process even more nerve-wracking — don’t worry, you’ve got this!
  4. The all-important home inspection
     Once you’re “under contract” (that is, agreed to buy the home), you'll want your loan officer to require a professional inspection to check the quality, safety and condition of the property — helping you avoid getting stuck with a money pit or having to make unexpected repairs. Based on the results, you can negotiate repairs or a discount with the seller.
  5. The appraisal
     After the home inspection, you will pay for an appraisal of the home. The appraiser will look inside and outside of the home and will review recently sold properties in the area. They will then provide a full report detailing the value of the home. If the value is higher than you agreed to pay, good for you! You’re already turning a profit. If it appraised for less than the sale price, you can try to renegotiate the sale price with the seller, or you may need to bring more cash to the closing table. Your loan officer will help you through the details.
  6. Time to close... Get ready for paperwork!
     The closing process involves signing a lot of documents in a very short period. Save space in your budget for closing costs, which typically add 2%–5% to the total home price. (Talk to your Andigo real estate loan officer about how to reduce closing costs with points, so you can use more cash toward your down payment.)

Are you ready to take the first step?

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Your home loan options in a nutshell:

Fixed Rate Mortgage

The highest degree of stability with monthly payments that never change.

  • No prepayment penalties
  • Terms from 10–30 years
  • Low down payment and FHA options
  • 24/7 online access to your accounts
  • Competitive rates

Adjustable Rate Mortgage

Still a 30-year mortgage, but the interest rate is only fixed for the first part. This is great for those who would rather lock in a lower rate for a 3-, 5-, 7- or 10-year term (or the length of time you’ll probably live in your home) instead of a higher, unchanging interest rate.

  • No prepayment penalties
  • Finance up to $1 million
  • Automatic transfers from checking or savings
  • 24/7 online access to your accounts
  • Competitive rates

5/5 ARM – our exclusive first-time home buyer program

  • Only 5% down payment required
  • Zero mortgage insurance (saving you hundreds of dollars per month)
  • Our 5/5 ARM will let you add a little wiggle room to your living space and your wallet
  • Exclusive to Andigo
  • Not just for first-time buyers — this great program is available to all
  • Competitive rates

Let’s discuss the best loan options for you.

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First-time home buying: asked & answered.

How much house can I afford?

A standard guideline is that your monthly housing payment should not take up more than 30% of your pre-tax income.

You’ll need to consider up-front costs like a down payment and application fees, closing costs and ongoing expenses like property taxes, homeowner’s insurance, association fees, private mortgage insurance and repairs (#adulting).

The amount you’ll be able to borrow is based on your income, credit history, size of your down payment, employment and residence history.

What are closing costs?

Closing costs typically range from 2%–5% of the home purchase; however, they can vary depending on loan amount, location and property.

Closing costs may include mortgage application fees, mortgage points, attorney’s fees, inspections, surveys, title insurance and title search, escrow deposit and city/county/state recording fees. Your lender will review these with you during your pre-approval meeting.

With our HomeAdvantage program, you can get a Cash Reward to apply to your closing costs. On average, Andigo members receive $1,800, depending on purchase price, which can make a big difference to the bottom line. Ask one of our loan officers for more details.

How important is my credit score and history?

Important. Lenders want to loan to people who are likely to pay them back. A high credit score reflects a strong record of on-time payments. If your credit score is lower than you’d like, confirm your credit info with the three credit bureaus, make all your payments on time and avoid maxing out your lines of credit to give your score a boost.

And it’s not just about the score. Check your credit report for unusual or incorrect activity. Your mortgage lender will help you resolve any issues that might be hiding under the FICO hood.

How big does my down payment need to be?

The larger the down payment, the less you’ll need to borrow and the more equity you’ll have in your first home. A lot of buyers shoot for a 20% down payment, so they can avoid mortgage insurance. However, that’s not always realistic for first-time buyers.

Some lenders have low down payment options, like our 5/5 ARM**, that allows for a lower down payment without mortgage insurance. Hello savings!

What is private mortgage insurance? And why do I have to pay for it?

Private mortgage insurance (PMI) is a policy that protects the lender from losing money if the buyer ends up foreclosing on the property. Home buyers are typically required to pay for PMI when they put down less than 20%.

Check out our 5/5 ARM program before you sign yourself up for PMI!

Questions about mortgages, home loan rates or online application? Let's chat!

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