Buying a home is a very important decision in your life, and the more you dilly-dally, the more discouraging it gets. However, there are things which can stand in between the house of your dreams. You want to buy a new home, is much of a positive thing, not a negative one, and so it is important to ensure that you are ready for house loans when the time comes.

Here are tips you need brush on to get ready to buy a home within the next year.

Get Rid of Outstanding Debts

The most important things you can begin with is to work on paying outoutstanding debt, very importantly your credit card debt. Paying the credit card debt improves your credit score, and plays an important role on how much qualified the bank deems you to borrow when you apply for a mortgage. It may seem like a step which is not related to house buying, but getting rid of your loans means that you will not need to think much about finances when actually buy your home and everything will be easier. If you are thinking to buy a home soon, it is better to pay off theloan rather than settle the debt, because settling debt has a very bad effect on the credit score.

Make your credit score compact

It is important to make a compact and clear credit report before you even think of applying for a mortgage. You can start by applying for a copy of your credit report and your credit score to see you stand. The higher your credit score means you will be offered much lower home loan rates in India. Make sure that you arecleared off any debts that are pending or is past due date. Then work on paying the EMI on time for the entire months for a year. This will help improve your score. If the borrow-to-income ratio is lower, it can help you a lot. If you opt for closing a few of your credit cards, make it a point to leave the oldest one open, even if you never use it. The companies report if you are past the EMI payment time, so be sure to make all of your payments to utility companies on time.

Save Up a Down Payment

Saving up always helps. If you save a down payment before you apply for a home loan, it can boost your confidence that you are ready to buy a home. It can also help you as a shield against those extra costs that are identical to purchasing a new home. The biggerdown payment you make while purchasing the home, the more loan amount you get which you will be able to spend on a home. A large down payment can make your dream home look much affordable since you have saved so much down when had made the purchase. Take the initiative to save up your down payment and the additional money you will need for when you sum up the closing of your mortgage.

So, here are the tips to prepare to buy a new house.