Buying a home is always framed as a major decision, primarily due to the costs and paperwork involved and here is Three Things Everyone Prospective Home Buyer Needs to Know.
It’s true, getting a house and a mortgage is a tremendous commitment and costs a lot of money overall, but doing so also guarantees that you have a roof over your head and that you’ll have something of significant value to sell at the end of your mortgage.
If you’re willing to commit and can afford the payments, becoming a home buyer can be one of the most gratifying experiences of your life, but there are certainly a few things that you need to know before jumping in.
Understanding that the mortgage isn’t the only cost
Once you buy a home, undoubtedly, the mortgage will be your largest monthly outlay, and while it is cheaper than renting, there are several other expenditures in the run-in to getting your keys that you need to take on board.
For a start, you’ll want to make sure, ahead of time, that you have all of the essential appliances and furniture set to be in your possession by the time you move in – or at least have stopgaps ready in case of late delivery.
Things like a fridge-freezer, washing machine, dryer, dishwasher, bed, and sofa likely won’t come to much more than $1,000-ish, depending on your brands of choice, with the latter two often coming by way of monthly payments.
Before you even get to that, though, you’ll need to pay for a lawyer – or conveyancer – to oversee the sale and make sure everything is above board. In addition to the basics, there are the often-overlooked hidden costs of buying a home that can quickly add up.
These can include property taxes, homeowners insurance, and possibly private mortgage insurance if your down payment is less than 20% of the home’s value. It’s crucial to budget for these expenses early on to avoid any nasty financial surprises down the line.
Costs like the land registration (a percentage of your home cost), GST or HST for a new build, provincial sales tax, home inspection and home appraisal, and moving costs will all need to be calculated and budgeted for, increasing the amount of upfront money required to complete the purchase of your new home.
Mortgages vary a great deal
One of the most striking aspects of buying a home is the amount that it costs across the board, as delved into above.
As such, if you can cut costs without hindering the process, you should leap at the opportunity.
While you shouldn’t skimp on the necessary hires, you will find that mortgages vary a great deal.
People will always suggest which provider you should side with, usually because professionals get a reward if you side with certain companies.
At the very least, using this comparison advice service will give you a strong idea of the rates that you can aim for when setting up your mortgage.
Using the service thereafter can potentially save you more money compared to using other methods of attaining a mortgage.
Make sure that you are the second opinion
You are required to hire a home inspector and likely someone to appraise the home before you buy, but you’ll have to be the one that finally signs off on the house.
The problem with inspectors is that they don’t tend to hold any liability if they miss something, and yet, they are often required when buying a home.
As such, go to the house with the inspector or beforehand (if the seller allows) to have a good snoop around yourself.
Be sure to have a notepad and your phone’s camera ready, and check these important areas of the home:
- The condition of the roof,
- Look for foundation damage, weather or water damage,
- Insulation thickness and vapour barrier,
- The ease with which windows and doors open,
- Verify all of the electrics and waterworks are functional, the water pressure.
So, keep in mind that you’ll want to get a price for all of the other expenditures on the way, that you can save money on the most considerable outlay, and that you should become your own inspector.
We hope you learned something from these Three Things Everyone Prospective Home Buyer Needs to Know.
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