In my experience, most buyers are extremely eager to start the process, but are not really sure where to start. Sure, you love a house and you want it yesterday, but what does that whole process entail? What is really practical for your lifestyle? What can you afford? This is what I'm here to help you with- Finding what's best for your lifestyle, and helping you get into it. Keeping in mind that every situation is unique, below you will find the typical step-"BUY"-step processes that most buyers encounter when buying a house.
First, I recommend seeing a mortgage agent before starting the search process. These mortgage specialists will be able to tell you what your affordability is, the terms and conditions of having a mortgage on a house, rates and the mortgage market, your credit score, your debt-income ratio, etc. This will essentially give you and your REALTOR®️ a budget to work with. Your mortgage specialist will tell you what is achievable based on your finances, and how you could potentially better your current financial situation, should you need to. One of the benefits of working at Ekort Realty, is that we also have a mortgage company in our office, Mortgage Architects. It's great to be able to bounce ideas and referrals off of one another to get quick and efficient results for our clients so they can proceed through the buying process.
What is important to you? Owning a home with a big yard? Having six bedrooms? Finished basement? Minimal upkeep? These are things to consider when imagining yourself in a home. Build a criteria of your priorities and I will work around that to find you what's important to you and your family. One major benefit to working with a REALTOR®️ is that we get the scoop on new listings right away. This is incredibly helpful when you’ve established this criteria because I can input your criteria into my database and automatically send you any listings that meet your criteria so you too, can be informed promptly.
The first house you see may not be (and likely won’t be) “the one”. Don’t let this discourage you. It’s GOOD to be picky. You need to ensure you’re checking the important things in a house, not just what colour the paint is and how unique the baseboard is. Check things like electrical amperage, where the laundry hook-up is, if there’s any moisture in the basement, if the windows seem to be drafty. These are the important things that are more costly to change later on, and you may over-look these at first if you’re blinded with the superficial features of the home. Your REALTOR®️ should have a basic knowledge on the specifics of these and be able to guide you and explain to you what different terms mean and how certain systems operate. The inspections will help as well with exposing most issues but before you spend the time and money on the house, keep your eyes open to issues.
Ok you love the house and you want it. What now? Now you’re going to write the offer to purchase the house with your REALTOR®️. We know how to write the contract. But you, as the buyer, need to be prudent about what your priorities are. If there are certain inclusions that are important to you, make this known to your REALTOR®️ so they can include it in the offer. Whether it’s the drapes, or the shed in the back, be specific with what you want included. If there are certain conditions that are important to you, between the knowledge of your REALTOR®️ and your own personal needs, you should collaborate your ideas at this point and make it known that you want certain tasks fulfilled before you trasnfer the property. One condition I always suggest to protect my buyers is a home inspection. Make your wants and needs known, and your REALTOR®️ should use their due diligence to get you what you want. After making the offer, you will need to put a deposit on the house. Whether you decide to give it with the offer, or upon acceptance, the purpose of the deposit is to show good faith in your interest of buying the house. There is no specific amount necessary, but 1%-2% is typical in this area.
Once the offer is submitted and accepted, you will need to get your financing together. If you are working with a lender, you will bring the offer to your lender to be officially approved for the mortgage. Remember that while obtaining a mortgage, there is a down payment that will be required to be paid by you, that is applied to the balance of the mortgage. These funds are transferred on closing day through the work of your lawyer and transferring funds. The typical down payment for first time buyers is 5%. There are other variances that go into the specifics of the down payment amount that your mortgagee will explain to you. If you are lacking a down payment and find that you cannot save enough to make a down payment, don't let this stop you, there may be other options available for you. There is a program in the Hastings area called the Hastings Down Payment Assistance Program. This is a forgivable down payment loan for 10% of your homes purchase price. The requirements are quite basic, and this is provided on a first-come, first-serve basis. I have gone through this process with my clients and it was incredibly easy, quick, and rewarding. If you are eligible for this program, I highly suggest giving it a shot.
You will need to obtain house insurance, and potentially mortgage insurance. Just like your financed car, your mortgagee needs to be protected, as well as your house, if anything were to damage it. This cost will vary with the house, age, condition, etc. But be prepared to pay a couple of hundred dollars a month. I also 100% suggest getting an inspection done. This is usually around $400-$500. The inspector will do the dirty work and find out what’s going on INSIDE the house. They will typically check the attic, the roof, the foundation, the insulation, the electrical systems, the heating and cooling systems, as well as the more obvious issues that need to be addressed, like a stair rail needing replacement.
You will also need a lawyer. The lawyer is the person that handles the transferring of title on closing, and also has the ability to check for any hidden issues with the ownership of the house. The lawyer handles the disbursement of funds, and helps to make your closing date as smooth as possible. This will cost you at least $1000-$1500.
I always recommend having extra money set aside should anything pop up on closing day. There may be adjustments on the closing date that require you to do certain things, ie) pay for a percentage of the filled propane tank. That’s an extra couple hundred dollars. Also the moving truck and moving fees, land transfer tax if you’re not a first time buyer. Everything adds up. Be prepared.'