Home Buying Process
Moving can be very exciting but it can also be very stressful as there are so many things to remember to do! Don’t despair; whether you are doing it on your own, asking friends for some help, or hiring professionals, here is a quick guide to help you get through the buying process.
Arrange an accelerated Bi-weekly payment plan on your mortgage.
On your mortgage, you will save the most money if you opt for an accelerated Bi-weekly payment plan, or if you double up one payment per year. This will shorten your amortization periods by over 6 years!
Avoid buying the most expensive home on the street.
The most advantageous situation is to purchase the worst home in a good area, rather than the best house in the worst area. “Location, Location, Location” is true!
Be sure to check into your lawyer’s fees ahead of time.
These are separate from disbursements. Ask your agent, who will be able to refer you to reliable professionals.
Don’t “low-ball” your initial offer.
Sellers tend to give less of a counter offer (closer to list price), if they feel insulted. Understand the current market value of the home and comparable SOLDS.
A pre-approved mortgage can be done for 90 days for FREE. You can usually negotiate your mortgage rate between 1/2-1% off the posted rates with your lender.
Have your agent arrange a home inspection.
A home inspection with a qualified engineer costs about $500.00 (approx). It could very well be your best money spent. You want to know exactly what you are bidding on.
Prepare a down payment of at least 20%.
When you have a down payment that is almost 20%, it is usually less expensive to arrange a first and second mortgage and save on CMHC insurance fees.
Take advantage of tax credits.
Place up to $20,000.00 per person of your down payment in a short term RRSP to be held for at least 90 days, or until closing.
Buying a residence can be a stressful experience. You will experience a roller coaster of emotions while finding the right place, securing the loan, and finally moving in. For most of us, the first time home purchase is the largest investment we’ve ever considered. The emotions of purchasing something so expensive and personal can often cloud our business judgment.
Be A Detective.
Check out all costs and expenses before you sign, including utilities, taxes, insurance, maintenance, and homeowner dues if applicable. Make sure all utilities (gas, electricity, and water) are on during your walk-through so you can inspect everything in working order. Ask lots of questions and be very detail conscious.
If it’s not in writing, It doesn’t exist.
All promises and discussions should be in writing. Don’t make any assumptions or believe any assurances. Even the best intentions can be misinterpreted. Have your professional keep an ongoing log in writing of all discussions and get the seller’s written approval on all agreements.
Income + Lifestyle = Mortgage Payment.
Sit down with your professional real estate agent and honestly discuss your income level and living expenses. Take into account future considerations, children, add-ons, amenities, and fix-ups. Your dream home is certainly worth a sacrifice, but don’t mortgage your entire future.
Utilize Your Team.
By aligning yourself with the right real estate professional, you will have an entire team at your disposal. Utilize your lender, title rep, and agent. Each of them should work hand in hand for your benefit. Explore all the options before you sign.
Do A Final Walk-Through.
Visit the property after all furnishings have been moved out to be sure there are no surprises. Be absolutely positive the property was left exactly as you had agreed upon in the contract. Things that could have been spotted in a final walk-through are often unintentionally overlooked.
Imagine the Property Vacant.
Your furnishings and decorations will be the ones filling this new residence. Don’t be swayed by beautiful furniture; it leaves with the owner.
Plan for Flexibility.
Closing dates are not written in stone. Allow for contingencies and have a back-up plan. If you or the sellers need a little more time to conclude the final arrangements, don’t let these delays upset or frustrate you. These types of circumstances are not uncommon in a real estate transaction.
View Several Homes.
See at least 7-10 properties. Don’t move too slowly, but don’t move on the first property you see. With your agent’s help, you should be able to view enough properties to get a good overall perspective of the home market. When you find the right property, all the leg work will be worth it.