From creating a budget to checking your credit score to understanding your purchasing power, buying a home requires time and preparation. Here is a helpful timeline to follow in this month’s Mortgage Explainer.

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– Buying a home requires time and preparation. Here is a helpful timeline to follow. 18 months out, create a household budget, figure out your monthly expenses and how much is leftover. See if there is anything you can cut out or debt you can eliminate that will increase your borrowing capacity. Check your credit score. The three major credit bureaus, Experian, Equifax, and TransUnion offer one free credit report a year. Create a savings plan with the goal of putting away three to five percent of the anticipated home cost for a down payment. 12 months out, meet with a lender. It’s never too early to educate yourself about the mortgage process and requirements. Figure out where you want to look for a home and the price of houses in those areas. Begin gathering documents recommended by your lender, such as W-2’s and tax returns. Six months out. If you are renting review your lease terms to establish a timetable for buying a home. Learn the tax implications of buying a home, including the potential deductibility of your mortgage interest. Simulate a mortgage payment. Take the difference between your rent and your anticipated mortgage payment and put it in savings. See how it affects your lifestyle. In some instances, your mortgage payment will be less than your rent. Send your lender, any updated documents, such as a newly filed tax return. Three months out, understand your buying power. Have your lender run numbers to give you the maximum purchase price you qualify for as well as the purchase price that will result in the monthly payment you are comfortable with. At this point, you may be able to begin the process of looking closely at houses in your desired area and price range. If you love something that you see online or drive by, contact your real estate agent to arrange a visit. With these steps in mind, you’ll be right on time to move into your new home.