There are many things that you can do to prepare yourself for one of the most important financial dicision most people will make in their lifetime.

1. Self Analysis - Take a good look at where you are in your life and decide if you are truly ready for the responsibility of becoming a homeowner. This is a typically a long term Monetary Commitment and requires financial maturity.

2. Budget Analysis-  This goes hand in hand with #1. Really analyze (write out) your entire monthly budget including ALL repetitive expenses. Don't forget the things that are paid for quarterly, semi annually, and annually. Also, make sure you factor in fun / entertainment money and such. This will help you to really determine what it is that you can comfortably afford. You want to enjoy your home, not look at it as a ball and chain dragging you down.

3. Homeowners Education- Although not normally mandatory for a loan, in some instances it is and I believe it will be required more as time goes by. There are many Home Ownership Counseling programs available, some are free, others have a nominal cost. This is well worth it for the (FTHB) First Time Home Buyer. You should be counseled in the various aspects of what being a homeowner entails, finances, the  Home Buying Process and how to react should a crisis rear its' ugly head. You will usually be given a Certificate of Completion, keep it in a safe place because you may need it for your home financing. Also, make sure the agency providing the counseling is HUD approved. This can be done by going to http://www.hud.gov/offices/hsg/sfh/hcc/hccprof14.cfm for an updated list covering your area.

4. Familial Requirements - What do you and your family require in a home. From Bedrooms to Bathrooms and room sizes to yard size, nearby educational facilities, available recreational facilities / areas, to every day storage, specialty needs/ requirements, etc... Better to think this out now then to have to live with a not so adequately equipped home, or to have to modify the home. Unless this was taken into consideration before hand.

5. Credit Analysis- Get copies of your Credit Reports from the 3 main Credit Repositories, Trans Union, Experian, and Equifax. Go over them with a keen eye for inaccuracies and dispute any information that you feel is not reported accurately or is not yours. Don't wait until the last minute to do this because it takes time to get things resolved if need be. Do this early in the process, months ahead of time if possible. Trust me, this could have huge consequences when applying for a home loan regarding your ability to qualify and your interest rate among other things.

Many times you can obtain them for free from www.annualcreditreport.com, or you can contact the Bureaus directly via the phone, internet, or in writing. Different States have different laws regarding the requirements for Free Credit Reports to be provided by the Repositories. In Maryland you are entitled to one FREE Credit Report from each of the Bureaus, once per year.

The three main Bureaus contact info is as follows:

Trans Union - P.O. Box 2000 Chester, PA 19016 --- (P) 800-916-8800 --- Website: www.transunion.com

Equifax - P.O. Box 740256 Atlanta, GA 30374 --- (P) 800-685-1111 --- Website: www.equifax.com

Experian - P.O. Box 2002 Allen, TX 75013 --- (P) 888-397-3742 --- Website: www.experian.com

6. Get Pre-Qualified - Seek out a competent professional Loan Officer. Whether it be a referral from a family member or friend, or just good old fashion research and homework.

A good Loan Officer spends time assessing your situation and NEEDS thru extensive questioning. Answer truthfully and don't try to hide anything. They can't properly advise you unless THEY are fully informed. 

They should be willing to tell you bad news just a quick as good, be in tune with the CURRENT market conditions, NOT necessarily what you hear on T.V. or the radio, and be accessible. They should respond to your attempts at contacting the within a reasonable amount of time. Bare in mind, you aren't their only client but they should be fairly easy to communicate with.

Getting pre-qualified will enable you find out what type(s) of loan(s) and terms you are able to obtain and assist you in determining what price range you should stay with-in. No point in looking at things you can't or won't buy. Saves yourself and your Real Estate Agent time, gas, and emotional distress. Remember what I said earlier, it not just what you qualify for, it's what you're comfortable paying. See more on this in my blog at http://activerain.com/blogsview/687453/Just-because-you-can.

7. Pick a Real Estate Agent- A good knowledgeable Agent can be of immense help throughout the Home Buying process. Take the time to find an Agent via referrals from Family, Friends, or your Loan Officer. Loan Officers work with agents all the time and should be able to offer up some assistance in this matter, or as I said above, good old fashion research and homework.

A good Agent will have knowledge of the area, keep your desires in mind, show you homes you're interested in and NOT just what they're interested in selling, help you evaluate asking prices, facilitate negotiations, draw up contracts, and help with inspections etc...

One final note, a Real Estate Agent should NEVER quote an Interest Rate or Closing Costs to you. I can't tell you how often I've seen this happen throughout the years and it is NEVER accurate. This is the job of your Loan Officer. Hence, the Pre-Qualification.

I hope you've found this information helpful and informative.

If you have any further questions, feel free to ask.