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YOUR FIRST HOME. Purchasing one is a rite of passage that most non-homeowners dream of. Besides the intangible benefits, homeownership lets you build equity, and is the single biggest tax break available to most consumers. Here’s our look at some smart strategies for getting in the door.

First: Pay Off Your Debt

It’s a common mistake for home-buyers-to-be: They focus on saving as much money as possible for a down payment instead of paying off other debts.

How Much Can You Afford?

The answer to that is a function of two things: How much you can borrow and how much of a down payment you can muster. As a rule of thumb, your annual mortgage payment, taxes and homeowner’s insurance shouldn’t exceed 28% of your gross income.

Types of Loans

Now you’re ready to start shopping around for the right loan. A first-time home buyer with a steady job and good credit can buy a home with less than a 20% down payment.

Questionable Credit

Worried you don’t have perfect credit? You may yet qualify for a loan insured by the Federal Housing Administration, or FHA. These government-insured loans are issued with even more lenient credit criteria. You can also put down as little as 3.5% for an FHA loan. A portion of closing costs may be used to meet the 3.5% cash requirement.

Down-Payment Assistance Programs

Still having trouble coming up with that down payment? Each year HUD gives states and municipalities money to distribute to low- and moderate-income families for housing.

Read more: Tips for First-Time Home Buyers – Spending – Deals – SmartMoney.com