The Steps to Buying a Home
Buying a home can be quite a daunting task! It requires a lot of time and effort, especially if it’s your first time. Learning about the process and the steps involved will give you a head start. You’ll also make better and more informed decisions too.
Before jumping in – know what you can afford
Ultimately, your home search is going to be determined by knowing what you can afford. In Canada, loan approval guidelines are quite tough and complex, with many factors involved. Below you’ll find a section covering the main factors affecting your mortgage application.
Talking to a mortgage professional can help you sort through your options. Whether through a bank or discount lender, you’ll get an idea as to what your interest rate and overall mortgage terms will look like.
The right stuff (we’re talking about your documents)
Mortgage lenders are strict on the documents needed to get you approved. A few years ago, maybe you only had to provide your tax return and a bank statement. Now, that list is quite a bit longer due to government regulations.
With that being said, don’t stress – your mortgage professional will give you a laundry list of documentation you’ll need, and also explain why each thing is needed. They can also tell you where to get a document if you’re not sure how to find it.
Make sure you’re confident with that pre-approval.
If your bank has given you a pre-approval but hasn’t asked for your documents or done an investigation, be cautious. There’s nothing more frustrating than getting declined once you’ve already made an offer. Most often, it’s because your banker hasn’t covered all the bases.
Make sure you’re dealing with a reputable mortgage professional who’ll spend the time on your file–then, you’ll be confident when it’s time to take the leap.
(*) Keep in mind that the property also has to be approved. So even if you have been preapproved, it doesn’t always mean you’ll get a final approval.
Now the fun starts – finding your home!
So you’ve been preapproved and are ready to start looking. Before jumping in, determine the main needs and goals for your home, then discuss options with your realtor. Are you looking for something move-in ready, or a fixer-upper so you can add your personal touch?
Things happen fast in the search for your home. While most people have their realtor on speed-dial, be sure to keep your mortgage broker in the loop as well so they can be ready as soon as your offer is signed.
Offer accepted! time to iron out the final details.
Once you have your offer signed, your mortgage professional will get your final mortgage approval. Most conditions are pretty standard, but your broker will help you sort through any rates and options to choose from.
At this stage, your broker will iron out any final details with the lender, including any additional documents they may need. Things like monthly or bi-weekly payments can also be discussed at this time. You’ll sign your mortgage loan commitment with your broker which will initiate the next step. Completion!
Almost there…the last step: getting into your home!
After you’ve made your deposit and sorted out the final details, you’re coasting at this point. Your lender will send the mortgage details to your lawyer, and they’ll work on finishing things up.
Your mortgage professional will make sure everything goes smoothly, and your lawyer will complete the title and mortgage registrations. Finally, your realtor will be there on your move-in day with the keys to your new home!