Getting ready to buy your first house can be daunting. Credit scores, down payments, and mortgages are all on your mind. Buying your first home can be one of the most exciting and stressful experiences of your life. Here’s a guide to help you get ready to make one of the biggest purchases of your life.

Step 1: Determine how much you can afford

The first thing to consider when buying a house is if it’s the right time to do so. Owning a house is a generally a worthwhile investment if you live in it for at least 5 to 10 years. Otherwise, renting is the better option. Many people buy homes as an investment, hoping that the value of the property will appreciate over time. And with rapid urban development occurring throughout the outskirts of the capital of Dhaka, appreciation is likely. However, it is important to do a cost-benefit analysis before such an expensive purchase. Property prices have indeed gone up exponentially in the last 10-15 years, but the prices are much more stable than before.

Though not always possible in an expensive real estate market, it is a good idea to keep total housing expenses under 30% of your total gross income. When you spend more than that on your mortgage, you risk becoming ‘house poor’. You may live in a beautiful house, but covering monthly expenses will prove considerably difficult.

Step 2: Prepare your finances for the mortgage process

The most unfortunate event is when you want to buy your dream home only to discover that you are not financially qualified to buy it.

Check your credit

To guarantee an approval on your mortgage application, you will need good credit, cash to close and a verifiable income. This is a good time to check your credit reports for errors and possibly invest in a few months of a daily credit score monitoring service. A fast way to improve your score by a few points is to pay down credit card balances and stop using them for two months before you apply for a mortgage. Also, you will want to avoid applying for credit (for example, a new credit card or car loan) until after you’ve closed on your new home.

If you are buying a home with a spouse or other co-buyer, your mortgage lender will likely consider both buyers’ credit scores in the application process.

Save cash for a down payment

In addition to making sure your credit score is in order, you will also want to consider the cash you will need to make buying your first home a reality. Then there is your down payment — typically between 3.5and 20 percent of the purchase price. As you save money for your down payment, avoid the temptation to invest in the volatile stock market with money you hope to use in the next year or two.

Step 3: Go shopping for a mortgage

It is important to consider where to take the loan from, what the repayment dates will be, the percentage of interest you have to pay, and the term of the loan. These things cannot be made on a last minute whim, and if done so, will only lead to long term dissatisfaction.