Know your budget. Before you even consider where you’d like to live or what kind of home you’re looking for, it’s a good idea to get pre-qualified or pre-approved for a mortgage. In some states, you can go to a mortgage broker, who’s job is to help you determine what you are qualified for and then find you the best financing terms. Alternatively, you can go directly to a bank and see what they are willing to lend, although we would recommend shopping around at least a few different banks. The difference could be $1,000’s of dollars over decades.
In any case, you should have a comfortable range of prices that you are qualfied to buy. Always remember, just because you can get a larger mortgage doesn’t always mean that you should. Consider future changes to your income, your willingness to commit to a very long-term financial obligation, and your current monthly cash flow. Click here to learn the details.
Let’s look at some specific questions sent in by DearMonty readers from across the country. Read more Q&A articles about the “Pre-Qualifying for a Mortgage” stage of the Home Buying process: