Millions of Americans want to become homeowners. If you're like most people, you don't have the cash available to go out and buy a home; so you'll need to obtain a mortgage in order to buy a house. Getting approved for a home loan can take a little effort, and there are a few things you should understand in order to become ?mortgage-ready?.

If you want to buy a house, you should start by estimating how much money you can afford to spend on your monthly housing payment. Do this by setting up a budget for your family and seeing what is left over after you pay for your bills each month. To better prepare yourself, for a period of one month, keep track of where your money goes each day.

Carry around a small notebook, one that will fit in your pocket or purse; and write down everything you pay for in the course of a day. You just need a description and the total amount spent. Do this for a full month (if you're married have your spouse do the same thing). This will give you a good idea where your money is going and see if there are unnecessary expenses that can be cut down or even eliminated. You'll be able to clearly see your needs and wants from your monthly spending.

Eliminating some of the expenses from your ?want? list will give you some additional money that can be saved towards your down payment. It is recommended that people put down at least 20% of the cost of a home in cash; but there are mortgage programs that allow you to buy without having much of a down payment. Open a new savings account that you will use only for saving towards your down payment; and put as much disposable income into that account as you can each month.

Stop using credit cards- unless you are able to use and pay them off in full every month. If you are carrying a balance on credit cards, focus on paying them off so that more of your money can be placed in your savings account towards your home down payment.

When you have some money saved for your down payment, order your free copy of your credit report. (Everyone is entitled to one per year from each of the major credit bureaus). This will help you see where you stand and whether your credit score is high enough to qualify for a home loan. It will also give you an idea of what type of interest rate you can expect to pay- the higher your credit score the better your interest rate. If there are any mistakes, take time to correct them now and ensure they are fixed on the report before applying for a mortgage. Having current delinquent accounts will make it difficult to get approved for a mortgage, as will having any accounts in charge-off/collections status. You may have to use your savings to get rid of any negative accounts or prolong your application for a mortgage until you get these things straightened out.

The good news is, if you spend several months preparing yourself to become mortgage-ready, chances are you'll have learned some very valuable budgeting and financial skills that will help you when you do finally become a home owner.