Thinking of jumping into the market but feeling a little overwhelmed by the process? We’re here to help! Here are some tips to help you get started on your path to homeownership.
- Rate discounts can save you thousands, even if they’re small. Your bank may say that you are getting a discount, but their rates are much higher in the first place. Shopping around using a mortgage broker is your best bet to get the lowest rates available while maintaining terms that you’re comfortable with. Even at renewal, your mortgage broker can request a discount on your behalf.
- Knowing your credit score can be trickier than you’d think. The score that lenders use is called a FICO score, and this score is not accessible to you on your own. By working with a broker, you can know what your FICO score is and specifically what you can do to improve it.
- Federal and Provincial savings programs, tax rebates and credits are available across Canada. These programs may have eligibility criteria, so make sure you ask your mortgage broker which ones are available to you. The savings from these programs can be tens of thousands of dollars when combined and used properly. Reach out for our full guide for first-time home buyers.
- You may only need a 5% down payment. If you’re struggling to save in this economy, don’t fret. The minimum down payment amount depends on the purchase price of the home — 5% for under $500,000 and less than 20% for under $1,000,000. If you purchase a home for $999,999 you will only need $74,999.99 for a minimum down payment, whereas a home that is $1,000,000 will require a $200,000 down payment!
- Put a condition of financing on your purchase offer to mitigate legal and financial risks of having your offer fall through due to the inability to obtain mortgage financing. Without a condition of financing, you could be in legal trouble if you can’t get a loan and don’t have the cash to make the purchase.
- Budget for closing costs, anywhere from 2% to 4% of the purchase price. This can include Land Transfer Tax, adjustment costs, legal fees and more. These costs cannot be added to your mortgage loan and your deal can fall through if you can’t afford them.
- Don’t cut out the professionals, having a good real estate agent, mortgage broker and lawyer will use their experience in the industry to help you gain knowledge so you can save time and money. Ask around for a referral first and check reviews, make sure you have a conversation with multiple professionals to find one that you are comfortable with.
These are just some of the reasons why working with a broker can save you thousands, all at no cost to you. Bring your dream of homeownership one step closer, and we’ll be with you every step of the way.