Buying
When you’re informed and prepared for what’s involved on the money side of buying a house in Toronto, you can save potentially hundreds of thousands of dollars over the course of your mortgage and home ownership.
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Lack Of Income History
Your income history is what tells a lender about the stability of your income. A lender may ask to see 9-12 months of consistent income before approving someone for a mortgage. A lot of entrepreneurs and independent contractors, as well as those who have recently started a business, may not have the income history to justify purchasing a home at this time. In that case, it’s best to wait to buy.
Do you want more tips on how to buy a house the right way? Look no further than the posts below:
- 3 Tips For New Home Buyers!
- 7 Things To Know About Buying A Fixer Upper In South Etobicoke
- 9 Ways You Know A Real Estate Property Is Right For You
Ignoring Your Credit Score
Keep up to date with where your credit score is at. It’s key to mortgage eligibility. The better your credit score, the lower your interest rate will be. There are many ways to obtain free credit scores and free credit reports. Check your report to make sure it is accurate. Ensure you invest the time to build up your credit score prior to applying for mortgage pre-approval.
Not Completing A Full Inspection
A home inspection will let you know the problems of a property, if any exist. Not getting an accurate inspection is a problem. It is the responsibility of the buyer to get an accurate inspection done and for you to make a contract contingent upon the inspector’s report. This might require the seller to take care of certain items before closing or to negotiate a lower sales price according to what needs fixing.
Failing To Use A Mortgage Calculator
Use a mortgage calculator to help you determine what you can and cannot afford so you aren’t looking at properties completely out of your price range. A lot of people skip this step and base their search solely on sales price but there are many costs to come.
Consider what you can realistically afford, with insurance, utilities, taxes, maintenance, and repairs. Mortgage payments will, ideally, be limited to 20-30% of your income.
Not Researching The Asking Price
The asking price is up to the seller to determine and they can get it wrong. An asking price can be too high, too low, or average compared to similar homes in the area, however, a potential buyer doesn’t know that until they research the market.
This is where a real estate agent can help you make a competitive offer based on what the market value is for a home.
Failing To Review All Costs In The Contract
You do not want to be hit with unexpected closing fees, underwriting fees, or loan disbursement charges after you agree to close. Examine total charges in writing before closing to get a full idea of what the totality of the cost is.
Purchasing A Home With No Savings
Do not buy a home at the expense of spending your savings. Have 3-12 months of expenses lined up in your emergency fund. You may need this amount, partial or full, if emergency repairs come up. Don’t invest this in a down-payment. Always purchase a home with your savings intact, even if it means sacrificing some of what you would have put on your down-payment.
Buying your first home is an exciting milestone! Here are some educational posts that will help you reach your goal:
- What Is The First Home Savings Account?
- What Happens On Closing Day When Buying A Home In Toronto
- How Much Money Do I Need To Make To Afford To Buy An Etobicoke Home?
Incorrect Estimations For A Fixer-Upper
Some first-time homebuyers want to purchase a fixer-upper in the hopes of buying something a little cheaper in exchange for having to do repairs and renovations to more or less bring it up to code. Many underestimate the cost of renovations, leading to having to pour more money in than they initially planned.
Not Researching the Area
Unfamiliar with the neighbourhood? Make sure to checkout the community, amenities, schools, parks, crime rates, traffic, transit, walkscore and if you get a chance, speak with the neighbours!
Are you looking to buy a house in Etobicoke? Research the best properties from Adrian + Andrea. Don’t make the same mistakes that so many others have. Find an amazing home at a great price. Search for your dream home with the help of the team at Adrian + Andrea.
Contact us today (416) 319-6893 or info@adrianandrea.com.