If you plan on investing in a property, then make sure that your credit is on board before you begin your home shopping. With a pre-approval from RBC we will be able to properly assess your overall credit and know exactly what purchase price you qualify for. Never put the cart before the horse. First- mortgage Approval— 2nd Start shopping for your property. Assuming you know how much you qualify for can come back to haunt you afterwards.
Conditions on your agreement/offer
Make sure to include a financing, inspection condition when you make a formal offer. These conditions are there to protect your best interest. The bank will do their due diligence on the property; double checking the value and structure. The inspector will mitigate any risks the property may hold that is not noticeable to the realtor or purchaser. Forgoing the home inspection can become a future added cost for the home owner.
If you have some money saved up for a down payment, all the better; however, it isn’t easy saving up $60,000 for a 20% down payment on a home. The more you opt put down, the better off you will be when it comes to the amount of money required for the mortgage. In Ontario and with RBC, you can buy your home with a minimum down payment of 5%.
Consider the real costs
Buying a home is not just about a mortgage payment; you have to consider utilities, property taxes, condo fees, potential repairs, etc. If you don’t have any money saved for emergencies (which should be three-month’s salary), you might want to consider how you plan to pay for everything. Then there are closing costs to consider; legal fees, land transfer fees, insurance and taxes. Make sure to speak to your mortgage specialist and inform yourself about what is involved.
Be sure that buying is the right thing to do
Before you jump into the home buying game, make sure that you are in a good place right now and for the future. If your job is on solid ground and you plan on starting a family in a couple of years, owning a home might be a great choice right now.
Feel free to call or email for further advice!