ThisWeek Community Newspapers

Before even applying for a mortgage, you need to obtain copies of your credit report and your FICO credit score. Doing this at least six months in advance should give you plenty of time to challenge any errors on your report and ensure that they're removed by the time you're ready to apply for a loan.

It's important to realize that being "pre-qualified" is not the same as being "pre-approved." Pre-qualification is where a lender tells you how much money you probably can borrow based on your financial situation. Getting pre-approval, by contrast, is a much more detailed process and involves actually applying for a loan.

Closing costs generally vary, but can total somewhere between 2 percent to 7 percent of the selling price of the home. Plan for these costs by getting a good-faith estimate from your lender early in the loan process. Make sure you have enough cash on hand and that it doesn't "disappear" before closing because of poor bookkeeping or a last-minute emergency.

If you borrowed too much and used every last dime for closing costs, you may be vulnerable to any unforeseen financial circumstances that may arise. It is best to have at least three months worth of reserves saved, or a fund equal to three months worth of expenses, to help you handle the added costs of homeownership without the stress.

In order to make sure you don't make any of these mortgage mistakes and jeopardize your dream home, or worse, your finances, it's important to work closely with a real estate agent who offers one-stop shopping -- with qualified mortgage resources right at his or her fingertips.

Harley E. Rouda Jr. is CEO and managing partner of Real Living, parent company of Columbus-based HER Real Living. E-mail: hjr@realliving.com.