10 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’d like your home to have.
Then prioritize the features on your list.
3. Select three or four neighborhoods you’d like to live
in. Consider items such as schools, recreational facilities, area
expansion plans, and safety.
4. Determine if you have enough saved to cover your downpayment
and closing costs. Closing costs, including taxes, attorney’s
fee, and transfer fees average between 2 percent and 7 percent of
the home price.
5. Get your credit in order. Obtain a copy of your credit report.
6. Determine how large a mortgage you can qualify for. Also explore
different loans options and decide what’s best for you.
7. Organize all the documentation a lender will need to preapprove
you for a loan.
8. Do research to determine if you qualify for any special mortgage
or downpayment-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.
Reprinted from REALTOR® Magazine Online by permission of
the NATIONAL ASSOCIATION OF REALTORS®. Copyright 2005. All rights
reserved. www.REALTOR.org/realtormag
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