What you need to know as a first-time home buyer
What is the advantage of home ownership?
Real estate is an incredible way to build your investment portfolio. Each payment you make create equity, and unlike other types of investments is less volatile and risky. Homes for sale in Canada have increased in price each year since 1998. Owning a home is step one on the property ladder and the equity you begin to build opens doors to future investments and security deposit options for additional loans.
How much do I need for a down payment?
A down payment is the amount of money you pay upon closing, and is required to obtain a mortgage. It is to your advantage to put down as much money as you can because interest costs for a smaller mortgage are lower-adding up to significant savings over the long run.
• For homes with a purchase price less than or equal to $500,000 the minimum down payment is 5%
• For homes with a purchase price greater than $500,000 and less than $1 million, the minimum down payment is 5% of the first $500,000 plus 10% of the remaining balance
• For homes with a purchase price of $1 million or more, the minimum down payment is 20%
The down payment amount is to be included in the cheque given to the lawyer. All major banks/institutions require that your down payment amount MUST be in your bank untouched, at least 90 days prior to closing. The down payment is over and above your deposit cheque. Your deposit cheque WILL NOT be considered as part of your down payment amount.
What if I don't have a down payment?
If you don’t have a down payment saved for your first house, you still have options. One possibility is borrowing up to $25,000 of your RRSP savings (per person; $50,000 per couple) under the Home Buyer’s Plan program. After a two year grace period you must begin paying back the funds you withdrew by making RRSP deposits each year and all funds must be replaced within 15 years.
Lease-to-own and 100% financing are two more programs that may enable you to achieve homeownership sooner. The Faris Team has excellent relationships with mortgage specialists that can outline these options and others for you.
Contact one of our trusted mortgage specialists.
Why should I get pre-approved for a mortgage?
You’ll find house-hunting is easier when you tap into the advantages of mortgage pre-approval. You’ll save time, seeing only homes you can afford, you can lock in the interest rate which is typically guaranteed for 120 days, and your pre-approved status will demonstrate to sellers and their Realtors® that you are a serious buyer, which can help during negotiations.
The Damon Bunting team works with exceptional mortgage specialists who will guide you on your home buying journey and offer great rates that save you money. There’s no cost to you and you’re not obligated to accept the mortgage when it comes time to buy.
Get Pre-Approved with a trusted mortgage specialist of the Damon Bunting team.
Do I really need a Home Inspection?
A home inspection is a great investment when purchasing a home, and we always highly recommend it. The purpose of a home inspection is to reveal all deficiencies in the home. Even in newer homes, minor items are to be expected. However, at times, there may be larger deficiencies that may need to be addressed. Conducting a home Inspection will help alleviate any unwanted surprises. A home inspection is a cost incurred by you, the buyer, the day the service is performed. Home inspection costs range from $300-$700 depending on the size of the home and the type of service provided. Typically a home inspection is anywhere from 2-4 hours depending on the size of the home. There are also other forms of inspections that we may advise such as: Environmental Testing, Wood Burning Fireplace Inspections, Oil Burning Furnace Inspections, Septic Systems.
What is the fee to work with Damon Bunting to buy a home?
As a valued buying client of Damon Bunting team, you work with one of our Realtors® free of charge. The fee for our service is entirely covered by the clients whose home you buy, as is industry standard.