A Checklist for First-Time Homebuyers

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Here are four things you'll need (and two things you won't) when you're ready to switch from renting to owning. Sure, owning a home is the American dream. It's also the largest investment most of us will ever make, so go into it knowing what is and isn't required.

Here's what you'll need:

• Enough money to make monthly mortgage payments. Duh! If a mortgage payment will bust your budget, you can't get rid of your landlord yet. Use a mortgage calculator to estimate your monthly payment.
• Enough income to pay property taxes and homeowner's insurance. The mortgage isn't the only cost you'll have each month. You also have to pay taxes and insurance. If you can't make those payments, say bye-bye to the house.
• The ability to maintain the property. You must keep a home in good repair or it will lose value and you'll lose money. You can do the work yourself or hire it out. Either way, you can’t ignore peeling paint and windows that won’t close, like you did when you were a tenant.
• A decent credit record. If you have lots of late payments, have declared bankruptcy or left old debts unpaid, it's harder to get a mortgage. And if you do get one, your bad credit record will make you pay a much higher interest rate.

Here's what you won't need:

• A big down payment. It's best to make a big down payment so you can skip paying private mortgage insurance (PMI) and lower your monthly payments, but it is possible to buy a house for almost nothing down.
• Experience. In most major cities, real estate companies hold home-buyer education classes for first-timers. Go, even if you have no immediate plans to buy. The information you get can lead you to other sources of help.

Photo by ©iStockphoto.com/theboone

For more information regarding first-time homebuyers visit HGTV.

Anti-Checklist: What Not to Do Until You Close Escrow

Take a list of things to avoid before you close on your new house.By Tara-Nicholle Nelson

Don't Close Any Accounts

It makes it look like you have less available credit. Pay accounts down to 30 percent, or pay them off if you insist, but DON'T close them!

Don't Make Any New Bills

New accounts create a FICO-reducing triple whammy of a new account/inquiry, an account with a short length of repayment history plus a high balance-to-credit limit ratio. (When you first open an auto account or installment account, you are already at your credit limit -- so it looks like you are maxed out.) The exception -- if you have no credit accounts at all, you should open one or two secured credit cards at your bank, then use them (up to 30 percent of the limit) and pay the bills on time every time.

Don't Buy a Car

See above. This also makes it harder for you to have a qualifying debt-to-income ratio, by increasing your debt without increasing your income. As a comedian once observed, "If you have a Land Rover and a landlord -- it's time to reverse your priorities."

Don't Pay Bills Late

You would not believe the number of people whose credit scores actually drop while they are house hunting because they make late payments. I've actually seen people who just barely got pre-approved have their FICO scores drop, find the house, make an offer, and then SURPRISE!! They no longer qualify for the mortgage because they have paid their bills late.

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10 Ways to Prep Your Home for Sale

Make your home stand out with a few easy improvements. With the high inventory of homes on the market today, homebuyers can afford to be choosy. Buyers are looking for the best, so a home for sale can easily slip through the cracks if it's not in pristine condition. Use these 10 tips to whip your home into shape and wow potential buyers.

Improve your landscaping. Curb appeal is crucial to a good first impression, so make sure your home's lawn is immaculate. Mow the lawn, prune the bushes, weed the garden and plant flowers.

Clean the outside. A sloppy exterior will make buyers think you've slacked off on interior maintenance as well. Be sure to clean the gutters and pressure wash your home's siding.

Make repairs. In a buyer's market, you want your home to be in the best condition possible. Take care of major defects like broken windows or a leaky roof that could discourage buyers.

Make the front door inviting. A fresh coat of paint, especially in a color that contrasts with the home, will make the front door stand out. Replace faded house numbers so buyers can see them from the curb.

Buy a new welcome mat. Let buyers know they're invited into your home.

Remove clutter and depersonalize. Buyers want to envision their belongings in your home. Clean up by renting a storage unit for knickknacks, photos, extra furniture and other personal items.

Organize closets and drawers. Messy closets give the appearance that your home doesn't have enough storage space.

Make every surface shine. From ceiling fans to floors and everything in between, clean your home until it sparkles.

Take color down a notch. You might like your lime-green bedroom, but it may sour buyers. Paint your walls a neutral color that will appeal to a wide range of buyers.

Eliminate bad odors. Hide the litter box and spray air neutralizer throughout your home. When showing the home, fill it with inviting smells by putting out fresh flowers and baking a batch of cookies.

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Stage Your Home Like A Pro

Staging your home, the act of preparing your home to make it more appealing to potential buyers, can be highly beneficial. After all, first impressions are extremely important! The way your home is staged (or isn't) can help a potential buyer decide whether or not they can picture themselves in that home, and can be a make-it-or-break-it factor.

But is it always worth it to hire a professional stager? Today, there are companies that specialize in transforming homes in the most marketable way possible. However, staging can be quite expensive. Most realtors recommend hiring a professional stager when your sale price is at least $500K or higher.

Generally, there are certain small things that sellers can do themselves to appeal to potential buyers. If you are considering staging your own home, check out these helpful tips from actual real estate agents designed to give you the best return on your investment:

The First Impression is the Last Impression Porches and front entryways are the first things a potential buyer sees, and are considered the most important parts of staging. Make sure the front areas of your home are clean, welcoming, and visible from the street.

Remove Personal Items While your home may hold many special memories for you and your family, potential buyers are looking for a place to create their own! Remove personal items (like family photos) and replace with neutral decorations (like a city skyline) so buyers can see themselves in your home.

De-Clutter You have probably lived in your home for a while, so it's reasonable to expect your home to be full to the brim. Many agents suggest investing in a temporary storage unit and clearing space in your home, so the home appears more open and inviting to potential buyers.

Clean No one wants to buy something that looks dirty and used! After de-cluttering, consider hiring a service to deep clean your home (for instance, get your carpets washed or bleach your tub).