Homeownership is something many Canadians dream of. A place to call your own. With high housing prices, this goal may seem unattainable but there are some steps you can take to help you get there.
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Homeownership is something many Canadians dream of. A place to call your own. With high housing prices, this goal may seem unattainable but there are some steps you can take to help you get there.
To purchase a home in Canada, most people need a downpayment of at least 5%.
It’s important to have some savings before you take the next steps to buy a property and one way to help you save is to have a budget.
The beginning of the year is a perfect time to set goals and start a budget. Calculate how much money you are going to need for your down payment and closing costs and set money aside to make up the difference.
To save up for a downpayment, the most effective strategies are to cut down on expenses, and/or increase income.
Start with cutting back on “wants.”
This includes a gym membership you don’t use, eating out, ordering in, and buying new clothes and items.
To increase your savings, look into getting a part-time job or a side-gig.
With the rise of the gig economy, it’s easier than ever to make a few extra bucks on the side.
On top of your down payment, you will also need to prepare for closing costs and other fees. Be prepared to pay for appraisals, home inspection fees, lawyer fees, and some other out of pocket expenses.
After you have healthy savings, it’s time to look into getting a mortgage. A mortgage loan makes it feasible for Canadians to purchase property.
When a lender approves you for a mortgage, you agree to borrow money in exchange for the lender taking title of your property. In order to qualify for a mortgage, a borrower is required to provide income documents and down payment documents. These documents include:
A lender needs to know that a borrower will be able to afford the mortgage, so having all your documents in order is key!
If you have bad credit, stop applying for or adding extra debt and remember to make each and every payment on time. There are many mortgage options available, and Smarter Loans uses a panel of industry experts to review and approve lenders. Even if you have less than perfect credit, their partners can help you obtain a great mortgage with easy approval. Check out the list of providers on their website.
Once you qualify for a mortgage, you have a deeper understanding of what type of property you can afford. Typically, houses in a downtown core are more expensive. If they are free-standing, or not attached to another home, you’re going to pay more. Want a backyard? That’s a premium too.
Be realistic with your expectations and keep an open mind when you are looking for a house. Find an agent who understands your goals and can help you find the house of your dreams.
Cheers to an amazing 2019 and good luck with all of your 2020 goals. If buying real estate is on your to-do list, use the Smarter Loans online portal as your one-stop source for locating local mortgage providers in Ontario for your financing needs.
