Checkrates.com is devoted to helping people buy homes. When done correctly, you will have the home of your dreams and a budget that makes it easy to enjoy your life. Selecting the right lender and Realtor is really important. In fact, we believe that you should have a lender and a loan approved before you go home shopping. If this philosophy makes the most sense to you then here are the steps you should take in the months before you buy a home.

1. Get a copy of your credit report and correct any errors. Everything starts with your credit report; How your loan is priced, what kind of loan you qualify for and whether you can buy a home at all. 

2. Reduce your debt. Pay down card balances to less than 50% of the limit. If you can pay them down to less than 30% of the limit, even better. Old collection account from that cable company? Pay it now. If you find yourself with medical collections, wait until you speak with a lender about paying those off because some programs allow medical collections to remain outstanding. As a general rule, prioritize to pay down those cards with the highest interest rates first.

3. Find a lender and determine how much you can afford to pay for a home. Decide how much you are willing to spend for a home. Both in terms of down payment and monthly payments. You can use the FHA for 3.5% down loans, Conventional for 5-20% down loans, or the VA (if you are eligible) for 0% down loans. You're going to need more than this for moving costs, utilities sign up costs, and reserve fund. 
 
4. Read up and learn basic mortgage terms. Read the FAQ's on checkrates.com

5. Get pre-approved for a mortgage loan. This usually entails a loan application with a mortgage company which should not take more than 30 minutes. They will pull your credit and examine your income and asset accounts. Usually you will need to give them income and asset documents consisting of paystubs covering 30 days and you last two tax returns with all schedules and w-2 forms. As for the assets, you will have to provide statements covering 60 days from the accounts sufficient to cover your down payment. You will have to document all large deposits that are not payroll related. 

6. Research neighborhoods that you want to a house (drive & online, if you like something ask your Relator to show it to you) Crime, Schools, Activities, Sports, etc. should all be taken into account.

6. Hire a realtor by interviewing several of them who specialize in the neighborhoods you are interested in. Make sure they are full-time and reputable. Experience counts.  

7. Visit homes and keep a journal with pictures. Plan on doing this for a few months. This will help you learn the market so you know when the "deal" is in front of you. 

8. Once you find a house you like, have your real estate agent determine the price you should offer. Look at comparable houses the sold in the last 6 months. You will be spending for an appraisal and home inspections which will be around $1000, so make sure you are reasonably sure you want the home. 

9. Have real estate agent write the offer. Make it as strong as possible but don't overpay. Your Realtor should be very involved at this point.

10. Complete all mortgage loan application requirements. Get an insurance quote as this can uncover past insurance issues such as mold or roof problems. 

11. Hire a home inspector to examine the house & be there for the inspection. You will learn a lot about the house.

12. Get an agreement on repairs to be made by the Seller. Sometimes its best to have the big things done and overlook the small items.

13. Inspect the repairs, walk through the house and look for issues that you didn't see before. Ask the lender if the closing figures are completed. Make sure the funds will be available on closing day by ordering wire transfers early.

14. Wire the down payment, sign the mortgage and pick up the keys for your home. Don't forget the garage door opener!

15. Keep the closing papers for your tax preparer! They will need your settlement statement.