Get pre-approved

Work with a mortgage broker who can discuss your lifestyle, your monthly expenses, and pinpoint a comfort zone for your monthly mortgage payment. In addition to pulling a credit report to help identify an appropriate mortgage amount, your mortgage broker should address any potential problems with credit, suggest solutions, and make you feel comfortable with potential loan packages and funding details.

Determine your wants

Identify the components you want in a home. In addition to the number of bedrooms and baths you are looking for, consider appointments. Do you like homes without carpet? Are you looking for a home in a particular area? Do you want to have a specific commute to work? Are you willing to improve a house after purchase or are you looking for something move-in ready? Consider the overall picture, your lifestyle, and identify your must-haves and the things that would be ideal, but not vital, and jot down notes. It will make initial discussions with your Realtor more productive.

Employ a Realtor®

All real estate licensees are not the same. Only real estate licensees who are members of the National Association of Realtors are properly called Realtors®. Realtors® are committed to treat all parties to a transaction honestly. Realtors® subscribe to a strict code of ethics and are expected to maintain a higher level of knowledge of the process of buying and selling real estate.

Real estate transactions involve one of the biggest financial investments most people experience in their lifetime. Transactions today usually exceed $100,000. If you had a $100,000 income tax problem, would you attempt to deal with it without the help of a CPA? If you had a $100,000 legal question, would you deal with it without the help of an attorney? Considering the small upside cost and the large downside risk, it would be foolish to consider a deal in real estate without the professional assistance of a Realtor®.

But if you're still not convinced of the value of a Realtor®, here are a dozen more reasons to use one:

1. Your Realtor® can help you determine your buying power -- that is, your financial reserves plus your borrowing capacity. If you give a Realtor® some basic information about your available savings, income and current debt, he or she can refer you to lenders best qualified to help you. Most lenders -- banks and mortgage companies -- offer limited choices.

2. Your Realtor® has many resources to assist you in your home search. Sometimes the property you are seeking is available but not actively advertised in the market, and it will take some investigation by your agent to find all available properties.

3. Your Realtor® can assist you in the selection process by providing objective information about each property. Agents who are Realtors® have access to a variety of informational resources. Realtors® can provide local community information on utilities, zoning, schools, etc. There are two things you'll want to know. First, will the property provide the environment I want for a home or investment? Second, will the property have resale value when I am ready to sell?

4. Your Realtor® can help you negotiate. There are myriad negotiating factors, including but not limited to price, financing, terms, date of possession and often the inclusion or exclusion of repairs and furnishings or equipment. The purchase agreement should provide a period of time for you to complete appropriate inspections and investigations of the property before you are bound to complete the purchase. Your agent can advise you as to which investigations and inspections are recommended or required.

5. Your Realtor® provides due diligence during the evaluation of the property. Depending on the area and property, this could include inspections for termites, dry rot, asbestos, faulty structure, roof condition, septic tank and well tests, just to name a few. Your Realtor® can assist you in finding qualified responsible professionals to do most of these investigations and provide you with written reports. You will also want to see a preliminary report on the title of the property. Title indicates ownership of property and can be mired in confusing status of past owners or rights of access. The title to most properties will have some limitations; for example, easements (access rights) for utilities. Your Realtor®, title company or attorney can help you resolve issues that might cause problems at a later date.

6. Your Realtor® can help you in understanding different financing options and in identifying qualified lenders.

7. Your Realtor® can guide you through the closing process and make sure everything flows together smoothly.

Most importantly, keep the lines of communication open. Be verbal about your likes and dislikes. And, keep an open mind. Most often, it's the little things that turn out to be the most important.