If you’re thinking of buying a home these days, particularly if it’s your first home, you’re probably a little nervous. Becoming a homeowner is a big commitment! So along with all the excitement of owning your own place (and the undeniable benefits of doing so), it’s only natural to feel some anxiety.

How can you know when you’re ready? Ideally, you are ready to buy when you’ve:

  1. Studied the market: The surest way to create peace of mind in a home purchase is to do your homework. Find out what similar homes are selling for and how long they’re usually on the market. What is available in your price range? What would be a reasonable offer? When you know these things, you’ll be more confident to make your decision.
  2. Maintained good credit: Mortgage lenders will use your credit history to determine your eligibility for a loan. Wondering what affects your credit history and how you can find out what your credit score is right now? Check out this Buy Owner Blog article, ”What is a FICO?”
  3. Saved a down payment: Most experts agree it’s best to put down at least 20% of the purchase price when buying a home. If you’ve saved that or close to that amount, you are well on your way to a new home!
  4. Prepared for the financial costs: As significant as the down payment is, it isn’t the only cost to be concerned with, however. You’ll also need to factor in monthly mortgage payments, property taxes, utilities, insurance, potential repairs, etc. Crunch the numbers to be sure you’re financially prepared, and if you are, you’ll know you’re going into the purchase with eyes wide open.

Of course, people buy homes all the time without doing these things. They didn’t study the market or have good credit scores or save enough for a 20% down payment. And sometimes, everything still worked out for them.

That’s because this list details not what qualifications there are to be able to buy, but rather qualifications that will give you the peace of mind that comes with making an informed, researched decision. Buying a home is a big commitment; in fact, for most people, it’s the most expensive purchase they’ll ever make.