Gross Monthly Income * .28 = Projected Monthly Home Payment

For example: If I made $2000 a month the I would say 2000 * .28 = 560. So this means that I would be able to afford a house payment in the area of $560.

Step 2: Get a Loan Pre-Approval
You can do this by going to a direct lender such as a bank or to a mortgage broker. After the process is over they will give you a pre-approval letter in which states the certain size mortgage that you qualify for. This letter will be very helpful to prove to real estate agents and sellers that you are not just window shopping.

Step 3: Hiring an Agent (Buyers Agent)
Using a agent can be very advantageous to a buyer. Agents have access to a greater number of properties that other wise you may have never found. They also have different ways in searching for properties that the general public do not have. When signing with a agent make sure that it is a buyers agreement. On signing this agreement the agent is bound by law to look out for your best interest. Before signing the contract you will need to negotiate on their fees and the amount of service you will receive for those fees, and you can arrange for them to be paid out of the transaction, not out of your pocket. When using a agent you need to communicate clearly on what type of property, price range, and area you are interested in.

Step 4: Write a Offer Contract
When you find the house that meets the criteria of your likes and dislikes and you think that it is the one you want then you will have to make an offer. The offer contract can be made through your agent or your attorney. In your offer contract be sure to spell out what you are willing to pay for and what you are not, when you want to close, and when you want to take possession of the home. Your contract should be contingent upon getting an inspection and evaluating the results. Should the inspection reveal a big problem, you and the seller can renegotiate the purchase price if you are still interested in buying the home.

Step 5: Getting the Loan Going
As soon as the seller accepts your contract you should go ahead and start following through with your loan. You should take a copy of the offer contract to the lender so they can start the loan process in earnest. If you have already been pre-approved it will pay off big in this step because the loan process will go somewhat quicker.

Step 6: The Appraisal and Inspection
The lender will arrange for the appraisal of the home, which may affect the terms of the loan or if the loan is granted at all. The liklihood of a house selling for more than the appraisal is slim but in such a case you will need to go back to the seller and renegotiate the price.

You will have to get the inspection arranged. Your agent will probably know of an inspector that you could use but you may also want to shop around in the phone book. If the inspector finds any major problems you will want to make sure the seller fixes them before you buy the home.

Step 7: Closing
Just because your at the closing table doesn’t mean that your out of the woods yet. Many things could still happen to jeopredize you getting the house. Some situations may include: the appraisal comes back the day before and is to low, your credit report had a unexpected glitch, or a problem with the house that wasn’t fixed by the seller. These are just a few problems that could occur on the day of closing and it may take time to handle these problems. That is why it is so important to do steps 1-6 to help insure closing goes smoothly and you get your new Hattiesburg home.