Give careful consideration to your financing options. Having pre-approval for your loan strengthens your position of negotiation and clearly defines the limits to the home price you can consider. One of the criteria used to determine a pre-approved loan amount is your credit score. A credit score is a numerical value based on an analysis of a person's credit files and is used to represent the creditworthiness of that person. Lenders, such as banks and mortgage companies, use credit scores to determine who qualifies for a loan, at what interest rate, and what credit limits. A credit score (also called a FICO score) ranges from 300-850. The higher your score, the less risk involved in lending to you.

• Pre-qualification is an informal way to see how much you may be able to borrow. You can be 'pre-qualified' over the phone with no paperwork by telling a lender your income, your long-term debts, and how large a down payment you can afford. Without any obligation, this helps you arrive at a ballpark figure of the amount you may have available to spend on a house.
• Pre-approval is a lender's actual commitment to lend to you. It involves assembling your financial records and going through a preliminary approval process. Pre-approval gives you a definite limit of what you can afford and shows sellers that you are serious about buying.

Consider local schools, property taxes, proximity to shopping and other services.

Remember that some characteristics of a home can be changed relatively cheaply and easily. For example, if you find your dream home—except the kitchen is painted hot pink—don't let that stop you. Rooms can be painted fairly easily, even before move-in day. In addition, a condition of the sale could be that the seller will paint the kitchen a color of your liking.

Once you think you've found a home you'd like to make an offer on, make the sale contingent on successfully passing a home inspection.

Consider that some day you will want to sell the property you're about to buy. Make sure you don't settle for a home that will have appeal to very few future potential homebuyers.

It is important to use a Realtor you trust. Integrity, honesty and hard work are required to find a home that is right for you. Consult with friends and co-workers to get agent recommendations, then search the Internet and spend some time browsing agent websites to find a few that are worth interviewing. Once you have selected a few, have a conversation with each, making sure you get some questions answered. There are some fundamental things you should ask, including:

• What techniques the Realtor uses to determine if a home is fairly priced.
• How the Realtor determines what property features are most important to you, and which are of least importance.
• How much time is typically spent viewing and evaluating homes before using your time to show them.
• How long the Realtor has worked in the area.
• Ask for references.

Consult reliable and unbiased sources, including:

• The home buyer's area of the U.S. Department of Housing and Urban Development website.