The Buying Process – What to Expect When Buying Your First Home
You’ve been renting for a few years and have been able to save up a bit of money for a down payment…You’re family is growing and your apartment downtown just isn’t going to do it anymore…Whatever the reason, you’ve decided that it’s time to finally buy your very first home: here are a few tips from the team and Yvan Gamache on making your dream come true.
Can You Buy?
It seems obvious but many first time buyers forget to ask themselves if they actually can afford buying into real estate. The decision of buying a home means being prepared to cover various costs both expected and unexpected – so that translates into making a budget and sticking to it.
A good rule of thumb when it comes to owning a home is that you shouldn’t spend more then 30% of your gross monthly income on housing. You also consider the additional costs such as condo and maintenance fees, insurance, municipal and school taxes. See the bill going up and up?
Before thinking about being able to pay your monthly mortgage payments and other expenses, you’ll need to figure if you can afford your home to start off – here comes the down payment.
New Rules for Home Buyers
New mortgage rules in Canada have come into force in early 2016, these were put into place to temper some of the country’s more heated real estate markets like Vancouver and Toronto but could possibly also influence your project. If you’re looking into a property that’s over $500,000 you’ll need to put down a 10 per cent down payment but anything under that price will still only require a 5 per cent down payment.
Over the past few years the government has brought in four rounds of changes to the real estate market notably: the minimum down payment was brought up to 5 per cent, the maximum amortization period was reduced to 25 years from 30 years and the maximum insurable house price was limited below $1 million.
Real estate experts like Yvan Gamache can help you tackle all of the above questions and help you find the right resources to make your dream come true.
A Realtor – Your Best Ally
We often associate real estate brokers with the process of selling a home but having a realtor by your side while you’re buying a new home is sure bet and the best of it all is that it’s free.
Not only will a realtor help you navigate through the paperwork, they’ll help you find the home that meets your expectations within the budget you’ve set. A realtor is also a great point of contact of different professionals you’ll need throughout the buying process: building inspectors, notaries, mortgage brokers, financial institutions and much more. Yvan Gamache and his team have build over the years a network of dedicated professionals who are to help you.
Search and Find
Undoubtedly, visiting homes and searching for the perfect one will be the most challenging part of the buying process. You’ll need to determine what you’re looking for and how much you’re willing to put forward while still feeling comfortable. Once you’ve found the property, you’ll engage in discussion with the seller through your realtor. That’s why having someone like Yvan on your side will help.
Negotiations are part of it, getting an inspection done and securing your financing is also part of it all. There are many little details to think about – like planning your move or any upgrades – that having a professional realtor by your side takes away a lot of the stress.
Making an Offer
You’ve found the house that meets all your needs, it’s time to make an offer to purchase. This document will allow to present to the seller various details such as the inclusions, the amount of your deposit, the closing day and other details like conditions related to a favourable inspection and the necessity of approved mortgage financing.
The seller can accept your offer or can make a counter-offer. If it comes down to negotiations, you’ll be glad to have an experienced realtor on your side to help out iron out the details. If all works well, your reply to the counter-offer will be accepted and things will move on. Sadly, it might happen that you may not feel comfortable with the counter-offer or maybe the seller won’t accept your offer, in such a case the sale doesn’t go through, your deposit is returned.
Securing a Mortgage
Obtaining your mortgage is by far the most important step in the whole process. Financial institutions and mortgage brokers have a variety of products that can suit all types of buyers – it’s a question of finding the best option for you. Fixed or variable rate, the amortization period, the payment schedule – there are many details to settle with your broker or bank. To find out more about the options available to you, ask Yvan Gamache and his team – they’ll be able to refer you to some amazing professionals.
Closing the Deal
Closing day is the day when you finally take legal possession of your new property. Forms are signed, hands are shaken and yes, the champagne bottle is popped open.
Congratulations, you just bought a new home.