Buying a new home should be fun and exciting, but only if your prepared.
Are You New To Canada? This Video Is For You
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First Time Buyer? Here's Some Mortgage Info For You
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Are You Ready To Buy A Home?
First - do you have the financial resources? You should have five percent of the purchase price of a home for the down payment, buy ideally even more. Are there other priorities in your life e.g. starting a new business, which require your savings? If not, buying a home should be on your radar.
Second - do you expect to stay in your new home for some time? Moving can be expensive and you will want to build some equity before having to relocate. Your job and home life should be stable.
Pre-Shopping
Before you start shopping for your home, give some thought to your lifestyle, the features you need and want, affordability, and the neighbourhoods you prefer. With this framework of information determined, you will come closer to finding your perfect home sooner!
What Can You Afford?
If you haven't already gone through the mortgage pre-qualification process, you will need to meet with a lender or mortgage broker. They will establish how much of a mortgage you will qualify for. Mortgage rates vary considerably and it is paramount that you shop around for the best rate, terms and options.
First time home buyers may want to take advantage of the federal government's Home Buyer's Plan. Under this plan, you may use up to $25,000 of your RRSP towards the purchase of a home. The money is tax-free as long as you pay it back in the next 15 years. Ask Sheri for details and she will help you to get the answers.
Take the time to prepare a budget. You will know what resources you can allocate to mortgage payments, living expenses and other financial situations. Everyone involved in making financial decisions should also be included in the process. I can assist you in helping you establish a budget, review financial qualification guidelines established by financial institutions and even suggest some ways to obtain financing, either through traditional lenders or other institutions.
You will need a down payment. This can be as little as 5% of the purchase price. This type of purchase requires a high-ratio mortgage and insurance. Canada Mortgage and Housing Corporation helps Canadians purchase their first home with high-ratio mortgages, through a federal insurance program.
To prepare your budget and plan, you'll want to collect the following information,
- Monthly rent or mortgage payments.
- Utility payments (gas, water, power, telephone).
- All other monthly expenses (such as food, child care, dues, etc...).
- Annual or semi-annual expenses (such as insurance, car repair, taxes, etc...).
- Non-fixed expenses for the last year (for example, medical expenditures).
- Records or an estimate of personal expenses (entertainment, travel, etc...).
- Credit card statements.
- You will also need to allow for unexpected items such as medical emergencies, travel and education.
Subtract all of the above expenses from your income. Could the remaining funds be directed towards a mortgage, debts or additional savings? How will a home purchase fit into your budget? Also consider items like insurance, taxes, repairs and maintenance.
What Costs Are Involved When Buying A Home?
There are two types of costs in buying a home - the initial amount you will need for your purchase and the ongoing costs of paying back your mortgage along with monthly operating costs. The largest one time cost is the down payment. It usually represents 5-10% of the total price of the property.
Typical one-time home buying expenses:
- Down Payment, 5%+ of the total price of the property, due at the time of closing.
- Deposit (due when making initial offer or shortly after). This amount can vary depending on the property.
- Mortgage application and appraisal fee.
- Property Inspection (optional), due at the time of the inspection.
- Legal fees and disbursements, due at the time of closing.
- Land transfer, deed tax or property purchase tax, due at the time of closing.
- Home and property insurance, at closing and ongoing.
- Moving expenses, due on the date of the move.
Typical Monthly Expenses:
- Mortgage Payments (including CMHC insurance).
- Maintenance (this could be condo fees or allocated maintenance fees).
- Property and content insurance.
- Property taxes.
- Utilities.
- Home Owner Association fees (determined by neighbourhood).
**Check out our entire Suite of Services for Buyers by clicking the button below,
First - do you have the financial resources? You should have five percent of the purchase price of a home for the down payment, buy ideally even more. Are there other priorities in your life e.g. starting a new business, which require your savings? If not, buying a home should be on your radar.
Second - do you expect to stay in your new home for some time? Moving can be expensive and you will want to build some equity before having to relocate. Your job and home life should be stable.
Pre-Shopping
Before you start shopping for your home, give some thought to your lifestyle, the features you need and want, affordability, and the neighbourhoods you prefer. With this framework of information determined, you will come closer to finding your perfect home sooner!
What Can You Afford?
If you haven't already gone through the mortgage pre-qualification process, you will need to meet with a lender or mortgage broker. They will establish how much of a mortgage you will qualify for. Mortgage rates vary considerably and it is paramount that you shop around for the best rate, terms and options.
First time home buyers may want to take advantage of the federal government's Home Buyer's Plan. Under this plan, you may use up to $25,000 of your RRSP towards the purchase of a home. The money is tax-free as long as you pay it back in the next 15 years. Ask Sheri for details and she will help you to get the answers.
Take the time to prepare a budget. You will know what resources you can allocate to mortgage payments, living expenses and other financial situations. Everyone involved in making financial decisions should also be included in the process. I can assist you in helping you establish a budget, review financial qualification guidelines established by financial institutions and even suggest some ways to obtain financing, either through traditional lenders or other institutions.
You will need a down payment. This can be as little as 5% of the purchase price. This type of purchase requires a high-ratio mortgage and insurance. Canada Mortgage and Housing Corporation helps Canadians purchase their first home with high-ratio mortgages, through a federal insurance program.
To prepare your budget and plan, you'll want to collect the following information,
- Monthly rent or mortgage payments.
- Utility payments (gas, water, power, telephone).
- All other monthly expenses (such as food, child care, dues, etc...).
- Annual or semi-annual expenses (such as insurance, car repair, taxes, etc...).
- Non-fixed expenses for the last year (for example, medical expenditures).
- Records or an estimate of personal expenses (entertainment, travel, etc...).
- Credit card statements.
- You will also need to allow for unexpected items such as medical emergencies, travel and education.
Subtract all of the above expenses from your income. Could the remaining funds be directed towards a mortgage, debts or additional savings? How will a home purchase fit into your budget? Also consider items like insurance, taxes, repairs and maintenance.
What Costs Are Involved When Buying A Home?
There are two types of costs in buying a home - the initial amount you will need for your purchase and the ongoing costs of paying back your mortgage along with monthly operating costs. The largest one time cost is the down payment. It usually represents 5-10% of the total price of the property.
Typical one-time home buying expenses:
- Down Payment, 5%+ of the total price of the property, due at the time of closing.
- Deposit (due when making initial offer or shortly after). This amount can vary depending on the property.
- Mortgage application and appraisal fee.
- Property Inspection (optional), due at the time of the inspection.
- Legal fees and disbursements, due at the time of closing.
- Land transfer, deed tax or property purchase tax, due at the time of closing.
- Home and property insurance, at closing and ongoing.
- Moving expenses, due on the date of the move.
Typical Monthly Expenses:
- Mortgage Payments (including CMHC insurance).
- Maintenance (this could be condo fees or allocated maintenance fees).
- Property and content insurance.
- Property taxes.
- Utilities.
- Home Owner Association fees (determined by neighbourhood).
**Check out our entire Suite of Services for Buyers by clicking the button below,