First Time Home Buyers
Buying Your First Home?
It’s exciting to buy a home for the first time. Buying a home can seem like an overwhelming task but that’s why there’s real estate professionals to help you get through it. We are here to help you from start to finish.
There are some very basic steps that every buyer should take to properly prepare themselves for the home buying experience. The preparatory work that you do today, will help ensure you have a great home buying experience and that you don’t make any costly mistakes.
Here are the basic steps that will help make your home buying journey a successful one. Essential steps for first time home buyers:
1) If you are thinking about buying your first home, start working through the steps early as it usually takes time to set yourself up for success.
2) Answer the question, what is it you want from buying a home? What itch or need is it you’re trying to satisfy? Perhaps you want to build equity instead of paying rent. Perhaps you are starting a family soon. Make sure you are happy with your answer because you’re about to invest a significant amount of money.
3) Determine what you can comfortably afford to pay. Some essential considerations that go into this step include:
- Never leave yourself cash poor – set aside savings to handle unexpected costs/events.
- How much of a down payment will you make? If you can, put at least a 20% down payment to eliminate expensive mortgage insurance costs.
- Talk to your banker about what they would be willing to lend you and the mortgage rates they offer (variable, 1 year, 5 year).
- After talking with your banker, talk with an independent mortgage specialist to understand financing options beyond your own bank.
4) Shop around for the best mortgage possible. Mortgage rates & term differences can very substantially which can mean huge savings to you. Don’t skip this step! Make sure to play around with the mortgage calculator to see how interest rates, down payments and term can impact what you pay.
5) Get a pre-approved mortgage from your lender of choice so you know how much you can borrow, what rate you will be charged and what monthly payments you will need to make. This document does not obligate you to spend anything. Be aware that pre-approved buyers are taken much more seriously by sellers than buyers who are not!
6) Once you know what you can comfortably spend, it’s time to figure what type of home best fits your needs:
- New build vs Re-sale home?
- Which community(s) do you like best?
- What type of property? (Apartment, townhouse, bungalow, two story, etc)
- What size of home? Think about your needs, not just today, but 5 years from now.
- What amenities are essential for you?
- List any other special features you want in a property?
7) Get a real estate professional to help you early on in the process – there’s tremendous benefits with it and no cost to you. Talk to several different real estate professionals to find one that you like and trust. Good realtors will provide you a wealth of information and help you through the process.
8) If you have any questions or want to have a free consultation on your home buying plan don’t hesitate to reach out. There’s no cost or obligation to you!
If you are looking for a comprehensive home buying checklist, download the Detailed Home Buyer Guide from CMHC.