Ten Steps to Prepare for Homeownership

  1. Decide how much home you can afford. Generally, you can afford a home equal in value to between two and three times your gross income.
  2. Develop a wish list of what you would like your home to have. Prioritize the features on your list.
  3. Select three or four neighborhoods in which you would like to live. Consider logistical features such as schools, recreational facilities, area for expansion, and safety.
  4. Determine if you have enough funds saved to cover your down payment and closing costs. Closing costs including taxes, attorney fees, and transfer fees and average between two and seven percent of the home price.
  5. Get your credit in order. Obtain a copy of your credit report and review.
  6. Determine how large a mortgage for which you qualify. Explore various loan options and decide what suits you best.
  7. Organize all the documentation a lender will need to pre-approve you for a loan.
  8. Research to determine if you qualify for any special mortgage or down payment assistance programs.
  9. Calculate the costs of homeownership, including property taxes, insurance, maintenance, and association fees (if applicable).
  10. Find an experienced REALTOR® who can help you through the process.