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If you’re anything like the average home-buyer, jumping into the home-buying process can be a tad intimidating. But it doesn’t have to be – as long as you’re prepared and you know what to expect. These 7 pointers are our top recommendations to ensure easy sailing all the way through to the notary’s office.
1. Save up the right amount
Discovering extra, unanticipated closing costs can be a major source of stress for a first time home-buyer. Avoid unpleasant surprises by informing yourself of the exact costs involved in a real estate purchase beforehand, and then saving accordingly. Remember that the downpayment isn’t the only lump sum you’ll have to save up for; closing costs include welcome taxes, inspection fees, notary fees and land transfer taxes. You can find a complete list of closing costs here. In terms of a comfortable financial buffer, it’s recommended that your monthly mortgage costs (including bills!) stay under 33% of your monthly income. Use that as a rule of thumb when you determine your ceiling priceLastly, keep in mind condo association fees if you’re buying a condominium. Pools, gyms and saunas sound great on paper, but they come with a recurring monthly cost. Be sure of what you can afford when you sign on the dotted line.
2. Get Pre-approved
Shopping around for a home without a mortgage pre-approval up your sleeve is a terrible idea. It’ll put you at a disadvantage in respect to competing bids, and it’s a recipe for disappointments if you end up overestimating your financial capacity. There’s nothing worse that falling in love with a home, having your offer accepted, and then finding out no bank will finance you for the loan. Don’t take the risk- get pre approved before you start!
3. Find a reliable broker
Working with a professional real estate broker is free for buyers and completely non-binding (you can continue shopping on your own or with other agents), so there’s no reason not to benefit from the extra guidance and market knowledge a broker may have to offer. Find someone who is trustworthy, knowledgeable, and someone you feel relaxed and comfortable around. You might have to spend several Sunday afternoons with them, so go with a broker who’ll make the experience fun and memorable!
“He who cares least wins.” Buying a house is probably the biggest financial investment you’ll make in your lifetime, so the best way to avoid buyer’s remorse is to avoid getting emotionally attached to any one option. I know the house fits all your criteria, but don’t let emotion blind your good judgement. Name your terms, negotiate what you think is fair (-here’s where you broker comes in handy again!), and either it will happen or it won’t. Getting over-attached will stress your out and could lead to bad financial decisions.
5. Book an inspection
Never buy a home without an inspection full stop. Make sure everything is in working order and if not, have the seller fix it or back out of the deal if it’s too much work. Look over the seller’s declaration carefully with the help of your experienced broker, and make sure that everything in the home is as listed on paper. If you’re planning on renovating before moving in, the inspection is a great time to start getting quotes and estimates on how much the works will cost. The sooner you start the sooner you can start enjoying your new home.
6. Get Homeowners Insurance
Homeowner’s insurance is a must, no matter how careful you are with your possessions. Your bank will insure offer an insurance package tacked onto your mortgage loan, but sometimes it makes more fiscal sense to pay the penalty and shop around for a lower rate. Whichever you do, make sure you’re full protected against all the regular hazards. Better safe than sorry!
7. Book your painters and movers well in advance.
Since moving in Winter is so inconvenient, moving companies, van rentals and handymen tend to get booked up all summer, and it can be hard to find someone available if you leave it to the last minute. Plan ahead of time and make sure everyone is really clear on dates and booking schedules. Getting an early start is especially relevant if you’re selling your old home while you shop for a new one.
After these 7 steps, you should be just about ready to move in! Congratulations! Settling into your new abode will feel so much better after a relaxing, stress-free sail through your first real estate purchase!