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Are You Ready For Home Ownership?

Owning a home may be your dream, but in order for the purchase to be the happy and satisfying experience it was meant to be, you need to ensure that you are financially and mentally prepared for the responsibilities that come with it.

Some people have a notion that home ownership is like renting, but with the power to have pets and paint the walls whatever color you like. However, while these privileges are available to homeowners, they come with the responsibilities of a mortgage, taxes and home maintenance. Preparing for home ownership requires you to take critical stock of your finances and your expectations.

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Questions for Prospective Homeowners

Are you ready to buy?

Owning your own home is about more than just being able to decorate any way you like; it's about being prepared to maintain your home over the years, realizing that part of your income and time will go towards repairs and maintenance. It's about being willing to take the risks of home ownership with a realistic expectation of the rewards.

How much can you afford?

It can be discouraging to find that your salary won't stretch as far as the home you want to own. However, sacrificing a huge part of your income just to pay the mortgage can very quickly make home ownership a burden rather than a point of pride. It's better to buy a modest home now and look at purchasing your "dream home" in a few years.

You will need a substantial deposit when your conditional offer is accepted by the seller. Your deposit will form part of your 'down payment', however the two are not the same. The amount of your down payment will also determine whether or not you qualify for a conventional mortgage, or require high-ratio mortgage insurance. A downpayment of less than 20% on a home will require mortgage default insurance. Contact us to be put in touch with one of our mortgage broker partners to learn more.

What is your debt-to-income ratio?

This is something that lenders take very seriously. Your overall debt should not be more than 40% of your income, and your housing debt should not be more than 32%. What 32% of your income will buy depends on where you want to live. In rural or downtrodden areas for example, it can buy a very comfortable residence and ample acreage. In highly sought-after urban areas however, it may not even buy a 400 square foot bachelor suite.

What do you want?

Do you like the idea of maintaining your own property? Lawn cutting, snow shovelling, repairs etc? If you'd prefer more of a hassle free lifestyle, but still want the benefits of home ownership, then maybe a condominium property is right for you. Do you prefer more privacy, and less restrictions on where you  can park, what colour you can paint, and whether or not you're allowed a barbecue? Maybe a detached home on a larger lot is right for you. Our job is to help you understand the options that are available to you, and help you choose the best fit for you.

We Can Help

You need a good agent who will work hard for you. Our real estate team is dedicated to helping you find the right home, at the best price. We want you to find the home that will make you happy and successful in real estate ownership.

When you hire us to help you buy your first home, we want to know what you want and how much you can afford. Then we'll find a way to merge these two priorities and find a residence that you'll enjoy owning.

Keep your objectives in mind when visiting a home. Sometimes the idea of owning a home can overwhelm your practical sense, so keep your feelings in check. Keep a list handy of the features that you need and want in a home, and judge each home by the list instead of by details that could distract you from your goal. When you're alone with your agent, you can go over the pros and cons of each home. We can help you stay on track while still keeping our eyes out for a great property.

Throughout the process of buying, you will likely view multiple homes. It's important to keep the feature sheets for homes that make your short list, and to make notes of your findings, likes, and dislikes after viewing these properties. When we sit down to discuss making an offer, it  will help you recall each of the homes clearly, and make the decision process that much easier.

Engage the services of a good real estate lawyer. We can recommend several lawyers in the area who might be a good fit for you. Interview them to ensure that you get someone you can work with. The legalities of transferring land ownership can be dodgy, and a lawyer can be your best defense against future legal troubles. A good lawyer can charge several hundred to over a thousand dollars for their services, but the thousands of dollars saved in legal fees later on makes this a good expense. Keep this in mind when approaching deals that offer to cover your legal fees in the transaction. This means that the other parties lawyer will represent them, and will not represent you. They will only facilitate the transaction. These deals don't always result in problems and complications, but its in your best interest to have a lawyer working for, and representing you.

Make the offer. This can be a maze of "buyer", "seller", "chattels", "deposit", and "completion" terms. We'll prepare the paperwork and go through it with you before submitting it. Ask questions if you don't understand something, or need clarification. We work at your speed, and are happy to take as much time as needed for you to be comfortable with the paperwork. This is a legal contract you are entering into, you must take the time to ensure you understand the entire contract, including its terms and conditions. Remember, the seller may reject or counter your offer, so even at this late date, avoid setting your heart on the home you hope to own. As we mentioned above, you'll have to write a deposit check to the seller's brokerage that proves the seriousness of your offer.

Get all necessary inspections done. A home inspector will check for signs of harmful materials like asbestos, lead paint and mold. They'll also check for evidence of pests, faulty wiring and leaks. This is a crucial part of the home purchase. Not getting an inspection done means that you could be stuck in a home with a bad case of black mold and no recourse other than to pay for its removal. Inspections will cost a few hundred dollars, but again, this is more than worth it in the end. There are several inspectors in the area that we'd be happy to recommend.

Do a final walkthrough before closing the deal. We'd be happy to do this with you to make sure that everything agreed upon is completed and in order when taking possession.

From the first interview that determines your requirements to the moment that you receive the keys, we can help you with the complicated process of buying a home. The worst thing you can do is not have a  professional working for you. When you 'don't know, what you don't know', you open yourself up to issues and complications, that can all be avoided by working with someone that knows and understands the process. Don't hesitate to contact us to find out more about how we can make the home buying process easier!

Contact us for more information about first time home purchasing.