Here are 12 steps for people who are dreaming of a new home for the holidays.

#1: Understand Your Numbers

Future home buyers should take the time to write down all of their monthly expenses and add in the expected new mortgage costs. Be sure to include things like utilities and insurance for the new home. Also, consider establishing a small savings account for unexpected repairs. Consumers should focus on spending during a month to get comfortable and get a feel for how the new house payment will fit into the budget.

#2: A Down Payment is Only One part of the Out of Pocket Expense when Purchasing a Home

You may qualify for a no down payment or low down payment mortgages, such as the VA loan or the FHA loan. If so, borrowers can save thousands of dollars at the closing table. However, the down payment is only one piece of the home buying puzzle.

Buyers typically make a down payment when they submit the offer, there is a thing called earnest money deposit. The amount of deposit is usually $1000. If the seller accepts the offer, and the loan is approved, the earnest money is usually applied towards the closing costs.

Service providers are called upon each time a mortgage transaction is completed. The lender, the real estate agent, the home appraiser, the local county courthouse, a homeowner insurance agent and the closing attorney are just some of the individuals involved in the purchase. All of the fees for those services are paid when the loan is closed.

#3: Time to Maximize Credit Scores

Consumers with the highest credit scores will usually get approved for the absolute lowest interest rate mortgages available and for smaller down payment loans.