So, you have taken one of the biggest decisions of your life, i.e. to buy your very first home in Canada. Firstly, many congratulations! Whether you have just moved to Canada or are living in the country on rent for many years, you need to get familiar with the home buying process. It is a quite complicated task and can become a headache if you don’t know how to buy a new home successfully without facing any legal issues.
So, here we are with some knowledgeable tips that will make your home buying process in Canada seamless and stress-free.
#1. Analyse what you can afford – Before you start looking for the home, the first and the most important thing that you need to do is to get an idea of how much you will be able to afford. This will help you in setting a realistic budget for yourself. Also, you will be able to balance homeownership with your lifestyle needs. The following are the few other factors that you need to consider while planning your budget:
- Closing costs such as legal fees, home inspection and land transfer taxes.
- Property insurance and taxes.
- Mortgage insurance (if required)
- Heating, hydro, water and other services.
- Home maintenance and renovations.
#2. Save for your down payment – Not everyone has enough money to pay the full price of the home at once. So, in that case, they make a down payment using the money they have saved. While buying home in Canada, you need to make a down payment of at least 5%. Anyhow, it is advised to pay a larger down payment (if possible). This will help in lowering your mortgage payments and can potentially avoid paying additional costs such as mortgage insurance.
#3. Learn different mortgage options – In Canada, a lot of mortgage features are available to choose from. The best way to understand them is to hire a mortgage broker. They can help save your time as well as money by providing you with the right mortgage solutions.
#4. Get Mortgage pre-approval - Before taking any further step in the home buying process, make sure to get a mortgage pre-approval. A pre-approved mortgage will help you know how much you can afford, and you will also know your interest rate. Also, mortgage pre-approval means that the bank has committed to providing you with the money four your new home.
#5. Find a realtor – Now it is time to hire a local real estate agent. The realtor can help you in finding the home that suits your budget. Also, they make your home buying experience comfortable by searching for a home that meets your property needs. They may charge some dollars, but hiring a realtor is worth every penny you spend. Because of their links, education and expertise, they make your home buying process in Canada smoother and faster.