You've got a budget and a spending limit on paper. You've started saving your cash. You've checked your credit reports and scores. And you've researched the different types of mortgages to see which one suits your situation. Now you're ready to talk to a mortgage lender.

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Pre-approval is when you work with a lender to determine two things: (A) whether or not you're qualified for a loan, and (B) how much the lender is willing to give you. Obviously, these are two pieces of information you are eager to know. Once you know how much you can borrow, you can start shopping for homes that fall into that range.

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These ten steps to buying a home are presented in a very logical way. It doesn't make sense to start house hunting before you've been pre-approved. And you should only talk to a lender after you've established your housing budget. So the pre-approval falls right in the middle. It happens after you've done your financial self-assessment, and before you start shopping for a house.

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Being pre-approved by a lender will also help you find a real estate agent. Logically enough, that's the next step we are going to discuss...