Home ownership is a classic element of the American dream. With home ownership comes a sense of pride, an investment tool, an ultimate increase in net worth, and a place to call your own. Buying a home is not always simple, though. This major, life altering purchase requires careful planning and budgeting. Keep these tips in mind when you consider buying a home.

Budget Accordingly
Start saving for your dream before shopping for the home of your dreams. You’ll likely need a down payment of 20% to qualify for a mortgage. Make an effort to set aside a percentage of your weekly income, and do so fastidiously. Keep these funds in a money market account or high yield savings account to maximize your efforts.

It’s also important to pick an upper price limit for the home you’re hoping to buy. Set a realistic number and stick to it. The standard rule for this limit is 2.5 times your annual salary. For instance, a family with an annual combined income of $60,000 per year should be looking for a home in the $150,000 and under range.

Check Your Credit before the Bank Does
You’ll need decent credit to qualify for a mortgage. Further, those with better credit scores receive better mortgage rates. If your credit is not great, don’t despair; you can work to improve it. Your credit counselor at A New Horizon will be happy to speak to you about credit repair options.

Get an Agent
It’s never been easier to search for a home without professional help. The internet abounds with resources and websites offering detailed home listings. Though these sites can provide you with an excellent idea of what’s available on the market, you should strongly consider contacting an exclusive buyer agent who can help guide you through the process.

A buyer agent works exclusively for you – not for the seller. They have access to all the MLS listings and will know how to work within the confines of your budget.

Know Where to Look
Other than price, what are you looking for in a home? Make a list of the important features; things you absolutely need. Three bedrooms? Two car garage?

These features may go beyond the physical attributes of the home, too. It’s always a good idea to buy a home in a good school district. This may benefit both your family and your resale value. You may also want to be aware of the commute time between your job and your potential home. google.com’s “Google Maps” can provide a useful tool for exploring this. If you ask for directions between two addresses, it will provide you with an estimated commute time.

Shop for a Loan
You’re going to be stuck with a mortgage for many years, so you want to spend your time finding the best one available. Even a small difference in the APR can add up to a big savings in the long run. It’s a good idea to start your search with reputable websites, such as LendingTree.com or Bankrate.com

Mitigate Your Risk
There are a myriad of problems – and ways to deal with those problems – that can arise from any home purchase. It can feel daunting: Home inspections, obtaining insurance, reading the contracts, and actually closing the deal. Your best bet is to retain the services of a real estate attorney who can help guide you through the process. It’s a small investment for a great deal of peace of mind.

To sum it up, a home is a great investment in your future. A little planning can make the whole process of purchasing a home smoother, clearer, and dare we say, even fun. Even if you don’t have immediate plans to purchase, it’s never too early to get your ducks in a row by saving money and polishing your credit.

Please don’t hesitate to contact your credit counselor at A New Horizon Credit Counseling if you’d like more information on resources that may be of assistance when purchasing a home.