If you are reading this article, you are looking for the three month countdown to how to afford a home. Everyone dreams of a home and for most, it is perfectly attainable. In today’s market, home buyers are sitting in an amazing spot. It is unfortunate the way in which the market found its downturn, however, it is also an opportunity for people who deserve to own a home, just could not get financed for a high amount.

Step One: Credit Report

The first step how to afford a home is to get your duck in a row so to speak. This means the first important aspect is to pull your credit. This needs to be done three months ahead because it will take that long to clear up any mishaps. This, to some, is the most excruciating part.

So, pull your credit report, which is offered free once a year, and start looking through it. Items that will bring down your credit are: late payments, collections, and high balances. In order to improve your score, you will need to get down balances on revolving credit lines (credit cards), take care of any collection you may have, and call the companies with late payments to see if they can remove them. You may be surprised what you can talk the people into if you use tactful behavior when speaking to them.

Do not get discouraged with this step as it takes thirty days, typically, for a company to update their records. If you pay something off, make sure you get them to send a payoff letter stating that you did pay it off in full.

Step Two: Organizing Your Paperwork

While you are waiting for your credit score to update and improve, you can begin getting your paperwork together. This means that you will need information such as:

• Proof of Employment
• A full 30 days worth of pay stubs
• 30 days worth of bank statement
• If you got your down payment as a gift, they will need a gift letter sign by the gift giver.
• If you got the down payment from investments, they will need proof that shows where the money came from.
• Have all payoff letters from any collections

These are the main items they will be looking for. By the time you get that in line, it will be time to take the next step on how to afford a home.

Step Three: Get Pre-Approved

Pre-approval is not the same as pre-qualified. Pre-qualified just says roughly how much you can spend. This is based off information the potential buyer tells the lender. A Pre-Approved letter means that the bank has verified credit, verified paperwork and has made a fairly solid commitment in lending the money pending the potential buyer finds a home. This is what sellers are looking for in today’s market. A pre-Qualification letter means nothing.

After you have been pre-approved, you can then look at houses. This usually takes about two weeks. The process of going through closing will take roughly 30 days, depending on where you are located. To get on the fast track, read more about getting information together and dealing with credit reports. You will find that how to afford a home is easier than you thought.