The benefits to owning your own home:
- The satisfaction of owning your own home
- Say goodbye to your landlord
- Start building equity
Owning your own home can be exciting and stressful. The 9 steps:
Step 1: Make a decision of whether you want to own a home or not
- How long do you want to live there for?
- Does buying make financial sense?
- Can I afford the house I need?
- Am I planning on having children? Mississauga Schools in Review
- Am I going to start my own business?
- Neighbourhood and schools I want to live in/near? Do I want to live in a condominium in Toronto or in a detached home in Mississauga?
- How’s the real estate market/economy that we’re in? Is it a good time to buy?
- Do we have time to maintain and upkeep my home?
Step 2: Seek professional advice: How to Find a Real Estate Agent
- Contact loan officer/bank/mortgage broker, to see how much you can afford. Its the biggest investment you’ll ever make, so choose someone who you trust. Perhaps seeking a second or third opinion to see whats the best rate you can get. Why Steven Ho?
Step 3: Get pre-approved mortgage: Buyer Financial Tips, Peel's Affordable Housing Program, Mortgage Calculator
- Credit scores and credit history to determine amount approved, interest rates (2 years of credit history, 3-4 tradelines on credit report, maintain good standing in your credit history) See: Know your Credit and How it works
- Employment history: Two-year job history
- Personal Assets: Bank accounts, stocks, mutual funds, RRSPs, etc. Also have 2 months worth of savings for closing costs or emergency. 9 Potential Sources of Funds
- Property value: The purchase price of the home you’re looking and the loan amount must be suitable to your income. The debt-to-income ratio will determine pre-qualified loan amount.
- Additional documentation: Two years of T4′s, last few pay-cheque stubs and/or two months bank account statements.
Step 4: Start house hunting! How to Find the House to Call home, Find your Dream Home
- Research based on the criteria you set for where you want to live, search online/newspapers/mls/craigslist/kijiji, etc.
- Once you’ve limited your choices, set up appointments to go see these properties with your real estate agent. Why Steven Ho?
Step 5: Find your dream home! First Time Home Buyers, New comer Buyers
Make a list of “wants” and “don’t wants” so you get a better idea of what you should get.
- Refine your search, somethings are more important than others. Find your Dream Home
- Goals of achieving your dream home can depend on each individual. Purchase Plus Improvement (get $50k from the government!)
- Remember: You may move 2-3 times before you reach your actual dream home.
- Save up for your downpayment! Should be at least 5% of the purchase price.
Step 6: Negotiate the deal! Purchase Plus Improvements
- Your real estate agent will help you with the negotiations.
- Before negotiating, set your limits of how high or how low you will go.
- Detach your emotions from house for now, as buyers remorse and stress can result unnecessarily.
Step 7: The closing period.
- Work with mortgage broker to close the loan.
- You will need the proper paper work for the property so that the broker can close the loan.
Step 8: Close the deal
- Prepare for closing costs. Have some reserve funds for lawyer fees, moving costs, taxes, etc.
- Agree upon a closing date, be respectful of the seller as they may be closing on a new home or waiting for kids to finish out the school year.
Step 9: Move In! 10 Steps for a Stress Free move!
- Congratulations! You own your first home!
- Make sure you get enough help to move into your new home!!