Buying your first house is a major achievement, but it can also be a challenge. You want a home that will serve your needs for many years to come, and of course, it must be affordable. To achieve your dream, you need to think ahead and prepare to become a homeowner.

Get Your Finances in Order

If you’re like most people, you will need a mortgage loan to buy a home. To secure a loan, you have to meet the debt-to-income ratio requirements. The percentage can vary but generally, you’ll need less than about 36–43% of your income going to pay recurring debts like car payments and credit cards. Paying down your debt will also raise your credit score, which can influence the interest rate you receive. Finally, consider your total budget. You will want to have enough extra money to keep saving for retirement and in case of emergencies.

Hire a Real Estate Agent

There are distinct advantages to finding a real estate agent to work with. A real estate agent will help you find the right house in your price range and will assist you through the steps of making an offer, negotiating a price, and closing the deal. Agents often learn about homes for sale before they hit the market. If you don’t know any agents in your area, you should ask around and research online. You should always look up a real estate agent’s reviews online to find out if they are reliable. Look for years of experience and communication style.

Get Pre Approved

Today’s real estate market can be tough, and you may have to compete with other buyers for highly-desired homes. Getting mortgage pre approval can give you an edge because the home seller will be assured that you can get financing. Sellers are hesitant to accept offers from unreliable buyers. Preapproval for a mortgage is a step above prequalification. The pre-approval process takes a close look at your finances and determines that you will probably be approved for a mortgage at a certain amount. You’ll submit a letter of pre-approval with your offer.

Your dream of buying a home can come true, but it won’t happen by magic. You may need to take some time working on your finances and credit. With careful budgeting, you should be well prepared to take the leap into home ownership.

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