Buying a home requires a high level of financial and personal security. You should have a steady income and expect for that income to remain steady in the coming years. In addition, consider whether or not you are planning to stay in the area long-term. If you don't imagine yourself in the same city in five years, you should reconsider purchasing a home.Don't just buy a home because it would be cheaper than rent and interest rates are favorable at the moment. Wait until you know you are truly financially and personally ready.The U.S. Department of Housing and Urban Development (HUD) offers housing counselors that can help you plan for your first home purchase. Visit http://www.hud.gov/counseling to find a counselor near you.;
, Your credit score will have a strong bearing on your ability to qualify for a loan. Having excellent credit will also reduce the amount of interest you will pay on the loan. Make sure that your credit score is good or excellent (over 700 or 750, respectively) to get the best rates. If you are applying with a partner, spouse, or friend, you will both need high credit scores to get these benefits. One person's poor credit can drag the overall application score down significantly.Check your credit score for free at http://www.annualcreditreport.com. You can access this score once per year.
 In order to qualify for a home loan, you'll usually need a down payment of 20 percent of the value of the home. In many cases, you'll also need at least six months' worth of mortgage payments in the bank. Finally, you'll also need money to cover closing costs, insurance, and taxes. If you don't have this money yet, consider waiting and saving for a few more years.You may be able to purchase a home with little or nothing down. However, this will typically require an additional expense known as Private Mortgage Insurance (PMI), that will add a significant amount to your monthly expenses.Closing costs can be anywhere from 2 to 5 percent of the home's selling price. Be sure to factor these into your calculations., Start by searching online for a calculator that can tell you how much home you can afford. Input your income and other expenses to see what your budget is. Then, search for homes on real estate listing websites like Trulia and Realtor.com to get an idea of what type of home you can afford. If these results don't meet your expectations, consider waiting to purchase your desired home when you can afford it.Remember that even though may technically be able to afford a certain amount, that doesn't mean that you can comfortably afford it. Remember that there will be unexpected home expenses, maintenance, and potentially unexpected life expenses in the months to come.
The point is, don't go broke buying a house. If you can't afford a certain amount comfortably, lower your budget., There is a large variety of loans available to first-time home buyers. In addition to standard bank loans, there may also be loans backed by your state that offer lower-than-market interest rates. In addition, the Federal Housing Administration (FHA) offers loans with low down payments to low-income buyers. These loans are also ideal for those with lower credit scores, as approval is easier to obtain. Veterans may also be able to qualify for VA loans, some of which offer favorable terms like 0 percent down. Talk to your agent, mortgage broker, or lender about availability for these programs.


For example, the FHA offers first-time buyers the ability to buy a home with as little as 3.5 percent down.Visit http://www.fha.gov/ for more information.
 Visit lenders in your area to get quotes for mortgage loans. Make sure to ask for loans with your desired terms, both in amount and duration. Once you've found one at a favorable rate, get a lender letter of pre-approval stating that you are eligible for a home loan of a specific sum of money. Many real estate agents require this as a prerequisite before taking on a prospective client., Determine what qualities you want in a home. Think about your present and futures needs for bedrooms, bathrooms, and common spaces. Think about your needs if you have a home business, hobby, or entertain guests frequently. Consider location as well. If you have children, you will want to be in a very safe area that's close to your desired school district. Make a list of qualities of your "dream home" to bring to your realtor.The HUD provides a printable home "wish list" at http://portal.hud.gov/hudportal/documents/huddoc?id=wishlist-en.pdf. Fill it out to help guide your search.
 Locate a good agent through referrals or online reviews. Go to their office and meet in person. Advise the agent of your situation and present your lender letter. Let the agent know what your preferences are. Ask to see available properties on the Multiple Listing Service (MLS) while you are there. Get a print-out of all information and availability along with current photographs for each house.


Seek an agent who is honest and moves quickly for you. Otherwise your dream home might slip away., Take notes about your first impressions and assess each home according to how well it meets, or fails to meet, your requirements. Ignore things that you can change, like paint colors, decor, and carpet. Imagine the house as it will be, not as it currently is. You can renovate a kitchen, but adding another floor or another bedroom is much more difficult. When evaluating, remember your priorities. Don't settle on a bad location just because you like the layout of the house., Narrow your search down to about three homes that meet your needs most closely. Your realtor can then schedule second visits of these homes so that you can look for any details you may have missed on your first pass.
 Make sure to check out the neighborhood before settling on a home. Talk to the neighbors about the incidence of crime, any noise issues, and the neighborhood community. Visit the neighborhood at different times of day to get a better feel for it yourself. You'll recognize red flags when you see or hear them., Ask for advice from the agent on the right amount to offer. The classic advice is to come in lower than the asking price. However, particularly desirable homes or those in competitive markets may require an offer at or even above asking. Your realtor will likely have a better handle on where you should make an offer relative to the asking price, so defer to their judgment. However, don't stretch your budget beyond your means, even if your dream house is in high demand., Let the agent submit your offer-to-purchase as soon as possible. Good properties don't last on the market very long. You will usually have to fill out an offer sheet with the help of your agent. This offer is then submitted to the seller for review. They can either accept or return with a counter-offer. Counter-offers are more common, though they may only make minor changes to the offer terms. Make sure to stay in close contact with your realtor after submitting an offer so that you can quickly review any counter-offers., Closing, also called settlement or escrow, involves the cooperation of the buyer and seller, their realtors, lenders, and lawyers to finalize the sale. Generally, most of this process will be handled by your agent. However, there may be some issues that require your attention throughout the process. Talk with your agent to inquire about the closing schedule and your responsibilities during this time.Closing costs are assessed during this time and include a number of fees, ranging from a loan origination fee to a survey fee.
You can expect closing costs to total 2 to 5 percent of the total cost of the home. So, for example, a $200,000 home would have closing costs of between $4,000 and $10,000.
Closing fees are estimated on your loan estimate when you apply for a loan. However, these fees often change during the closing process., Your offer will stipulate a certain number of days or weeks before closing so that financing can be finalized and the house can be inspected. During this time, the house is checked for any major structural issues, termites, and to ensure that the property boundaries are correct. You should accompany the inspector and your agent during the structural inspection, both to learn more about the house and to ask about any imperfections you might see.


Make sure to spend the money to get a truly professional home inspection. Getting a cursory, budget inspection can cost you a lot more in the long run., There will be a meeting on the closing date in which you will required to sign final documents releasing payment to the seller and taking possession of the home. At this point, the home will be yours, and the deeds and other documents will be signed and transferred. You will then receive the keys to your new house., Ask your realtor during closing about homeowners insurance. This type of insurance reimburses you in the event that your home is damaged or destroyed. Your specific insurance needs will depend on your geographical location, the value of your home, and the situation surrounding your purchase of the home. For example, you may need flood insurance if you live in a particularly flood-prone area, as most homeowners insurance plans do not cover flooding.


You will need to get homeowners insurance when you close on the house.
Assess your financial readiness.
Improve your credit score.
Save up for your purchase.
Calculate your budget.
Check to see if you qualify for government loan assistance.
Obtain mortgage pre-approval.
Describe your dream home.
Contact a full-service agent.
Let the agent take you on a tour of the homes that interest you.
Ask to revisit the two or three you like best.
Investigate the neighborhood.
Prepare an offer on your favorite.
Submit your offer.
Ask the agent to explain the closing process.
Inspect the house thoroughly.
Close on the house.
Buy homeowners insurance.
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