My Real Estate Blog

1. Your Savings. You may already know how much of a monthly payment you'll be comfortable with, but the buying process will also include other expenses, such as a down payment and closing costs.

2. Down Payment Options. Do you qualify for a down payment assistance program? Will you be able to get an FHA loan and pay only 3.5% down? Do you have a relative that would like to make a down payment gift? In a perfect world, we could all put down 20%. Explore your options!

3. Check Your Credit Report. Your credit report says a lot about you. Lenders use it to evaluate your risk potential and to see how responsible of a borrower you are. They use this report and score to figure your interest rate. The more stellar your report, the better your score and thus the lower your rate will be. Be sure to check your report for accuracy, and report any errors to the credit reporting agencies.

4. Get Pre-Approved. Talk to a lender before you start looking.  A pre-approval will give you a ballpark figure of how much the bank would be willing to lend you. Are you looking for a $250,000 house or a $500,000?

5. Get Pre-Qualified. There is a difference!  This is the official letter from the lender that says they will be willing to lend you money because you've given the lender black and white documentation. Most sellers won't consider an offer seriously without the lender letter.

6. Affordability. The bank may tell you that you can afford a home worth $500,000 but that doesn't mean you'll be comfortable with those payments.  Always ask for a Good Faith Estimate!

7. Housing Criteria. Now that you have a budget, develop a list of what you need and want. This can include anything from "must have 3 bedrooms" to "hardwoods" or "granite".

8. Neighborhood Choice. Location strongly affects prices. A 3,000 square foot home in rural Kansas costs a fraction of one in the Metro DC area. Decide what neighborhoods and areas are the best fit for you. This will help narrow your home search.

9. Hire an Agent. An agent can help you navigate the entire process from searching, putting in offers, to finding inspectors or general contractors.

10. Start the Search! The web is a wonderful place to begin your search. 84% of buyers now start their search online, so you'll have plenty of company.