This article by the late Bob Bruss on costly mistakes home buyers should avoid illustrates some key points but it's important to emphasize a couple subtleties.
The asking price of a home should be completely inconsequential to the price you offer. A common mistake both investors and first-time home buyers make is negotiating from the asking price.
The asking price is a psychological tool to get the buyer to pay a certain amount. It can be anything, above market value because of the owner's pride or below to attract competitive offers. The market value is what a reasonably informed group of people are willing to pay at that instant.
So, do you pay the asking price or market value? How about "neither?" Within reason, you should only pay what the property is really worth to you. Maybe it's special to you in some way justifying more money; maybe it's just a stopgap; maybe you have an angle no one else has seen yet. The point is that your price shouldn't be colored by what the owner asks from you, unless your offer is unreasonable enough for them to dig in or end the negotiation.
You should never be surprised by your credit score. It's the most basic tool you have in lowering the cost of your mortgage and negotiating with lenders. By understanding how strong your FICO score is, and in turn how strong your position is, you can reduce the fees you pay and your interest rate.
It usually costs you nothing for a "buyer's agent" to represent you. In fact, it seems like common sense. Going into a real estate transaction without your own agent is like going to court without your own lawyer. Would you do that? Only in one case: arbitration. (Which isn't really going to court.) Read on.
If the agent is a trusted third-party who can act as an impartial intermediary, then all sides can win. The buyer and seller negotiate a fair price and are given a portion of the agent's commission, because the agent gets to represent both halves of the deal. In California, this type of "dual agency" must legally be disclosed to all parties involved.