Step By Step First Time Homebuyers Guide
There is nothing more exciting then fulfilling a lifelong dream of owning a home. You will finally have a place to call your own and your home may also be the most important way for you to grow financially.
When buying a property it is very important to have all the information and tools you need to make an informed decision.
Our company will make the home buying process clear and straightforward. Fell free to contact us here to arrange a no obligatory meeting or keep reading our guide to familiarize yourself with the basics of home buying process.
How much can you afford?
There are numerous expenses related to home ownership. In addition to mortgage payments you will incur property taxes, property insurance, condo fees, utilities, TV/internet/phone and home maintenance costs. It is important to consider all of those before deciding on purchasing a property.
Lenders add up your housing costs (that include mortgage payments, taxes and heating) and figure out what percentage they are of your average gross monthly income. This is called your Gross Debt Service (GDS) ratio and to be considered for a mortgage your GDS must be 32% of less of your gross household income. You can calculate your GDS ratio by using Canada Mortgage and Housing Corporation’s online calculator here.
It is possible for first time homebuyers to buy a property with as little as 5% down payment. In order to be able to buy homes with a minimum down payment, consumers are required to buy Mortgage Loan Insurance. The insurance is usually added to the mortgage and included in monthly payments. To calculate your Mortgage Loan Insurance premium and rate click here.
Before approving a mortgage, lenders will look at your credit report to see how well you have paid your debts and bills in the past. It is very important to start building your credit history early as lenders may look as far as 2 years back. Make sure to use at least 2 sources to build your credit history of which one is a credit card.
There are several benefits of getting a pre-approval. First of all you will know what you can afford so you won't waste your time on looking at properties that are out of your price range and you will avoid disappointment when a dream home turns out to be out of reach. You may also be able to negotiate a better price on a property as sellers tend to like offers from a qualified first time homebuyers more.
Our company works closely with trusted mortgage brokers so when the time comes for buying a home you can be sure to be linked with best professionals in this field.
Except from a down payment you will encounter many other costs when buying a home. Those expenses may include: appraisal fee, home inspection fee, title insurance, land registration fees, condo document fees, prepaid property taxes, property insurance and legal fees. All those can add up to a significant amount so our company will help you estimate them in advance.
Finding a right home.
Once you have a good idea about your finances you'll be ready for your home search. Our company uses the latest technology and intense networking to stay on top of constantly changing real estate market. We will help you determine your needs regarding location, size and type of a property to ensure your investment is the best possible one. Feel free to contact us here to discuss your possibilities.