Steps to Buying Your First Home

We understand that as a First Time Home Buyer one can become frustrated and confused when it comes to the whole buying process. We're here to guide you every step of the way. We are more than application processors - like at the banks - we are mortgage specialists!

Step 1

Basic information gathering

Find out which area you would most likely buy in. Determine an approximate price range you would like to spend. Consider a maximum monthly mortgage payment. Consider what features you want in a home. Determine how much you can put towards the downpayment (minimum is 5%). Check out some books or web sites to get a feel for the whole process.

Step 2

We can now prequalify you

By having a quick chat with us we can tell you how much of a mortgage you (and your spouse if applicable) qualify for. This gets you on your way to see the price range of the home and monthly affordability. Also we can determine if you have a straight forward approval situation or we need to look for a lender which will understand your unique financial situation.

Step 3

Choose the players on your team

You need to determine who your realtor and mortgage lender will be. You can choose a lawyer and home inspector at a later date. We can recommend someone to you as we have contacts for reliable professionals in these related areas to make your overall homebuying experience a great one.

Step 4

Written preapproval

With our online Quick pre approval form or via telephone and fax we can get a commitment letter from the appropriate bank so now you have the complete confidence in your home purchase. This will also provide you a mortgage rate guaranteed for up to 4 months. Most lenders provide only 2 months.

Step 5

Go house shopping

With your written pre approval and a full understanding of all the steps and requirements its now time to see the real thing. We're here for you as questions arise and you need help.

Step 6

Finalize your offer on the property

Once your offer has been accepted the next step is to have the home inspected by a professional home inspector. There is usually a 7-day window to do this and finalize your financing condition. There are still some minor things to complete like an appraisal on the home (an independent appraiser lets the bank know the true market value of the home regardless of what you have decided to pay for it) approximate cost $250 - $300.

Step 7

Know your responsibilities before the closing date

Communication is the key here and we take pride in that. Many house purchases can go awry because buyers didn't know they still had some things to take care of before closing like getting documents to the lawyer, obtaining home insurance and providing further financial documents to the lender. When dealing directly with your bank they will not take a proactive role to follow up and remind you and assist you with these final important steps to a successful closing date. Again this is where we'll help you out. We want you to be so happy with our service that you'll be a client for life!

Typical Costs of Home Buying

Rule of thumb estimate:

Often people forget to budget for closing costs. Use 2% of the purchase price. That would work out to $4000 on a $200,000 purchase price.

Costs to Expect

Land Transfer Tax:

All buyers of property pay this once and new homes are exempt from this. Budget about 1% of the purchase price. Check with Local City Tax Charges- some cities have additional Land Tax.

Legal Fees:

Your lawyer will charge you on the closing date for registering the mortgage and for acting on the purchase. The fees can often be misunderstood so it's important to ask for the total costs including the disbursements. Budget approx. $1000 - $1500.

Home Inspection and Appraisal:

These are fees to make sure the house is in fine mechanical and physical condition. The appraisal is to assure you and the bank that the price you have decided to pay for the home is in line with neighbourhood market values. Budget approx. $500.

PST on CMHC Mortgages Only (less than 20% downpayment):

Now that Ontarians are paying 8% tax on insurance's - this is applicable on CMHC insured mortgages. Budget approximately $300-$500.

Interest, property tax and other adjustments:

Based on closing dates and the time of year there are various adjustments made and must be paid by you. Say the current owner has paid up 2 months of property taxes therefore you will have to reimburse them on the closing dates. Budget approx. $500.