If you have considered buying a home but you aren’t sure how much house you can afford, here is a suggestion. Choose a financial institution that you trust and have them do a preapproval. It prepares you for when you really are ready to make a serious offer on a home, and many real estate agents ask you to obtain one so they know you are serious about buying. The main thing, though, is that it gives you an idea of how much you can afford given your current circumstances. Consider buying a home that costs $20000.00 to $30000.00 less than what you are preapproved for. The result: You will be less likely to find yourself financially stressed down the road should your circumstances change, and you will save a ton of money that you would otherwise have spent on mortgage interest, not to mention higher property taxes, utilities, and maintenance. Most people don’t regret making the decision to choose a less expensive home and with the economy the way it is right now I don’t think there are too many people saying they wished they had bought bigger homes. If you choose to use a real estate agent to help you find the right home, and you are planning to pay less than your preapproved amount, you can ask your financial institution to mark your preapproval down to a lower amount so that your real estate agent is less likely to try to pressure you to spend more than you would like. This seemed to work well for us. Our real estate agent never knew the amount we really were preapproved for so we felt no pressure from him to pay more than we wanted to.