Buying a home for the first time can be overwhelming. There’s a lot to figure out and a lot to do to get ready. A new home is most likely the biggest purchase you will ever make. Being prepared will help make sure the transaction goes smoothly. Here are our top three tips to help first time home buyers secure the home of their dreams.
The first step when you’re planning to purchase a home is to get your deposit ready. You need to have at least 5% of the cost of your home in order to obtain a mortgage in Ontario. So you should have this amount ready before you even begin looking for a home. The amount of your deposit will depend on the cost of the home you want to buy. But it will generally range anywhere from $5,000 – $20,000. Having the full deposit ready will help you secure the home you want when you find it.
Once your down payment is ready, the next step is to get pre-approved for a mortgage. The amount of your mortgage will be based on the amount you earn, what assets you own and how much debt you owe. Getting pre-approved will let you know how much you can afford to spend on your new home and what your monthly payments will be. Once you are pre-approved, you will know what type of home you should be looking at.
Pre-approval will also let you know what your mortgage rate will be. It’s a good idea to lock in a rate to ensure you won’t be hit with increases if they occur before you’re ready to buy. Most pre-approvals are guaranteed for a 90-day period.
It’s also important at this time to make sure all your paperwork is submitted correctly, and that your mortgage is completely qualified. This will help ensure there won’t be any problems when you find your home and are ready to buy.
First time home buyers often want to look at a wide range of towns and neighbourhoods. To find a home that really fits your needs, you should narrow down your search to a specific area. Decide on a set of criteria that matter to you, and use them to select the neighbourhood that will be the best fit.
House prices vary greatly from neighbourhood to neighbourhood, so what type of home you can afford will depend on where you’re looking. Narrow down your search to your ideal location then look at prices to see what you can afford there. You may have to adjust your location or house size depending on your budget.
Once you have your deposit secured, your mortgage pre-approved and know where you want to live, you’re ready to start looking for your new home. If you have taken the time to prepare, you won’t miss out on your dream home when you find it!
If you’re ready to buy and are thinking of hiring a realtor, contact The Kormendy Trott Team at 1-800-617-0090 to get started.