Before getting carried away with the excitement of home hunting, most real estate agents recommend you first get a good idea of what you qualify for, by talking to a lender about a pre-approved mortgage.
Lenders will look at your income, your credit score and history, and the amount of down payment you have saved, before calculating the amount of your pre-approved mortgage. With a pre-approved mortgage in-hand, you'll know how much you qualify to borrow, you'll have a good idea of what your interest rate will be, and, therefore, you'll know how much your payments will be.
One important thing to keep in mind when searching for a pre-approved mortgage is that if you approach several banks, your credit might be "pulled" more than once, which could have a detrimental effect on your credit score. The reason for this is that the credit rating agencies will notice the activity and think you're shopping around for a lot of credit. The way to ensure this doesn't happen is to have a mortgage broker take care of the groundwork for you.
A mortgage broker will pull your credit once, and then use this information to shop around the different lenders to find the right mortgage product for you.
You owe it to yourself to make some time to learn more about today's mortgage options. Let's sit down together and discuss what you're looking for, what level of buyer you are (first-time buyers have completely different needs than homeowners looking to upgrade, for example), and what your "loan personality" is.