When buying a home, making sure you can afford the purchase is the first hurdle to overcome, and that may be a lot easier to do, depending on where you live.
Moving to a less-expensive locale may make sense, especially for freelancers, telecommuters and independent contractors whose jobs allow them to reside almost anywhere. Those who need to live close to work or school may have little choice but to stay put and save up until they can make that down payment.
Once you’ve figured out where you want to live — and how much you’ll need to earn to afford a house there, assuming you’ll make a 20 percent down payment — follow these steps to help ensure your house hunt goes smoothly :

1. Stick to your limits. Have a budget and figure out how much you’re able to spend. Keep in mind the maximum price you can afford — and don’t look at houses above that price point.

2. Understand your needs vs. your wants. Before starting the hunt, make a list of what you’re looking for in a house. While you may want a Jacuzzi, you may really need a room for a home office.

3. Remember to take pictures. The lovely video and photos on the real estate agent’s website won’t show the warts that you may find while touring the home. Put your smartphone to good use and take your own photos or videos inside and outside to help you remember specific details.

4. Give yourself a credit check. Once you’ve found your dream house, check your credit. Your credit score is one of the most important factors lenders will look at to qualify you for a mortgage. Yet 6 in 10 Americans couldn’t tell you their credit score if you asked them, according to a survey from LendingTree.
This is a critical three-digit number that you can get for free in less than five minutes. Several credit card issuers, including Discover and Citi, give free scores, or you can order your free score from CreditKarma.com, Credit.com or LendingTree.com. Keep in mind, however, that scores may differ between these platforms, depending on the algorithm each uses to determine your score, but you will at least get an indication of your standing. A free copy of your credit report can be obtained from each one of the major credit reporting companies (Equifax, Experian and TransUnion) at www.annualcreditreport.com. Check your report for any mistakes, unpaid accounts or collections before applying for a loan. Correct errors and try to improve your score before putting in the application.

5. Finally, shop around for a loan. Banks offer different interest rates, and you want the lowest one you can get. Look at online banks as well as brick-and-mortars. Lower mortgage rates will help to reduce your monthly payments and allow you to qualify for larger loans. That way, even if you can’t move to a less-expensive area, you may be able to afford a pricier home. That’s good news this spring, as home prices may rise due to a record low supply of homes for sale.

Happy house hunting!

5 Steps to Happy House Hunting by Sharon Epperson | MSN Real Estate