First-time homebuyers in Canada have plenty of pitfalls to be careful of when navigating the minefield of real estate purchasing. Those first-timers looking for an efficient guide for homebuyers in Canada should keep these tips in mind when starting the journey. There’s nothing worse than unexpected expenses and other nasty surprises during the process that results in setbacks and buyer’s remorse.
Know What your Budget Can Afford
The primary cause of the 2008 financial crisis in the United States was subprime mortgages, which are primarily targeting first-time buyers who may not realize how much how they can afford. It’s easy to get stars in your eyes when you see that four-bedroom, three-bathroom dream home, but making purchases based on what you want and not what you can afford is a big no-no. Have a budget in mind before you decide on buying a house, so you know exactly how much you’re spending each month. Be sure to account for credit card payments, student loan repayments, and any other monthly expenses that you may have.
Always Get Pre-Approved for your Loan
What you think your budget can afford and what the bank is willing to loan to you are two vastly different sums. If you don’t get pre-approval for your mortgage before you start looking at houses, you’re wasting the time of everyone involved in the process. Mortgage loan approval is highly dependent on your income and credit score, so be sure there won’t be any changes to those two things while you’re seeking pre-approval for a loan. Mortgage loans have been known to fall through at the last minute if a person’s financial situation changes in any way.
You’re Not Going to Get Everything on your Checklist
First-time homebuyers go into house hunting with a massive checklist of must-haves for their new home, which often results in frustration for the real estate agent and their customer. Be realistic about your expectations and realize short of building your own home to your exact specifications, you’re probably not going to get everything you want on your list. It’s helpful to make a list of the absolute must-haves and then consider everything else you may want as a bonus. Be willing to compromise with your first home buying experience; otherwise you could end up renting for far longer than you anticipated.
Additional Expenses Will Pile Up
Homeownership seems appealing when you consider how much money is “thrown away” by renting, but it comes with more responsibilities and more costs that first-time buyers usually don’t consider. Property taxes, home insurance, house repairs, and other unexpected expenses can add up so consider saving some of your initial mortgage loans to cover these costs during the first few years in your new home.
Never Buy a Home You Haven’t Had Professionally Inspected
This point is pretty simple; if you haven’t had a home professionally inspected by an inspector you’ve hired, do not buy the home. It’s easy to fall in love with the layout and location of a house and ignore the faults it may have. Be able to keep your feelings in check and listen to an inspector. That beach home might be in your dream location, but if it has a cracked foundation, you’re in for a world of financial pain.