Step by Step Buyer’s Guide

Step 1: Assess Financial Readiness

Assess your present household budget and your annual income to determine if you are eligible for a mortgage and how much you can comfortably afford. Also check out the Mortgage Affordability Calculator.

Calculator showed that you are not eligible? Don’t get upset – find good mortgage agent, to talk about your financial situation and lenders with a different approach to mortgage approval process.

Step 2: Is right now a good time to buy?

Markets go up, markets go down and even the smartest experts can’t accurately predict when a market will peak or bottom out. If you’re buying a home as a long-term investment and for long-term enjoyment, you should be protected from short-term changes in the market. Pick a home that meets the needs of you and your family. Then you’ll enjoy living in your investment as it grows in value.

Step 3: Decide what type of home you want.

By now, you probably have a good idea of location you want to live. Other thing is what type of home is right for you. To familiarize yourself with the terminology, here’s a quick overview:

Step 4: New or Resale

Step 5: You know what you want, but let’s talk needs!

Are you getting out of a two-bedroom apartment because it’s too small? Then your new home should have at least three bedrooms, and likely a second bathroom. REALTORS call these must-have features “needs”. Features you’d like to have are called “wants”. Your strategy should be to find a home within your price range that fulfills all or most of your ‘needs’, and as many of your ‘wants’ as possible.

Step 6: Sell your current home

Not too many people can hold onto two homes at the same time, so you’ll probably need to sell the one you have now. Be sure to check my incredibly helpful Selling section. In the meantime, here’s a quick overview.

Step 7: Figure out how much you can afford

Before you start looking for your dream home, let’s find out how big you can dream. Knowing your true budget is the first and most important step in buying a home.
A home is a big purchase. It’s probably the most expensive thing you’ll ever buy, and there are lots of expenses you might not even know about. Some of them include:

Everyone’s total costs are different, but it’s almost guaranteed you won’t have that much money saved up. Hopefully you have enough for a nice down payment, but for the rest…
Yes, you need a mortgage. So determine how much a bank will lend you. To make it easy please head over to Мortgage page of my website.

Step 8: Arrange a Mortgage.

Money makes the world go round, and a mortgage gives you the power to buy a home. This isn’t the most fun step in buying a home, but it’s vital. Who do you talk to?

Step 9: Type of service

There are a number of different kinds of relationships that you can develop with your REALTOR®. However, they all fall primarily under two categories – Representation and Customer Service.

Step 10: Find a REALTOR who is right for you.

Step 11: See what’s out there

Your REALTOR can take you to areas you’re considering to get a feel for them. Make note of surrounding schools, shopping, and recreational areas. Keep an eye out for not-so-great things like large industrial areas, railway tracks and airports. Visit during the day and at night.

Walking through a potential home is a thrill, but try not to lose your head. Don’t let a giant kitchen island or swanky hot tub distract you from your real goal, finding a home that meets all your needs and fits your budget.
You’ve found a home? Congratulations! Now, if you actually want to make it yours, you have to make a successful offer, one that the seller will accept.

Step 12: Preparing the offer.

Here are some terms you’ll see in the offer.

• Buyer – That’s you.
• Seller – The present owners.
• Purchase Price – The most important number. Let’s hope the seller goes for it!
• Deposit – A cheque you write to the seller or the seller’s broker. This is your way of saying ‘my offer is serious’.
• Chattels included and Fixtures excluded – Be sure you know what is included with the house—the washer and dryer, the microwave, draperies, light fixtures. Don’t leave anything to ‘chance’.
• Irrevocability of the Offer – The length of time you give the seller to consider your offer.
• Completion Date – The glorious day you take possession! Usually 30 to 90 days after signing.
• Clauses particular to this Agreement – Every transaction is unique, and you may want to add conditions that are important to you, such as a proper home inspection.

Step 13: Submitting the offer.

You’ve signed on the dotted line and your offer is provided to the Seller.

Step 14: Final Mortgage approval.

Step 15: Home Inspection.

Home inspections rarely cost more than a few hundred dollars, and can save you from unpleasant surprises and long-lasting regrets. You may want to make a conditional offer based upon a satisfactory home inspection. This is an increasingly standard condition on any resale home. If the seller doesn’t want you closely examining the home before you take possession, you have to wonder why.

Step 16: Add a Lawyer to your team.

There are lots of experienced real estate lawyers out there. Ask your friends, family or co-workers. REALTORS will happily give you the names of several lawyers experienced in real estate. Be sure you ask your lawyer how they structure their fees, and get an estimate of the other legal costs you can expect.
There are many, many legal steps to transferring ownership of land from one person to another. Even if pitfalls like fraud, government legislation, zoning issues or unpaid taxes don’t come up, your lawyer will more than earn their pay by making the legal transfer of the home a smooth one.
He or she is here to help you. Ask questions if you don’t understand anything. Explaining legal jargon in plain language is a big part of their job.

Step 17: Close the purchase.

Your offer has been accepted and you can’t wait to move in. But don’t break out the bubbly just yet. You have to close the deal. Your REALTOR and lawyer will do most of the closing work, but here’s your checklist.

• Immediately begin satisfying any conditions of the agreement that require action on your part. Your REALTOR can fill out the documents stating that the conditions have been satisfied.
• Have your Lawyer begin searching title to the property. This can take a while, so make sure you allow ample time.
• Well before closing, get your Homeowner’s Insurance to be effective on your closing date. Your Insurance Broker will give you a ‘binder’ letter certifying that you’re covered. You can’t get a Mortgage without this letter!
• Contact your lender and have them finalize your mortgage documents. Have your lawyer review them before you sign.
• Your Lawyer will transfer essential utilities like hydro and water, but you’ll have to make sure telephone and cable companies switch their services to your name.
• If you rent, give notice to your landlord or sublease your apartment.
• Begin planning your Big Move! Where are those cardboard boxes?
• Send out your change of Address information and fill out a card at the post office. Contact the Ministry of Transport about changing your driver’s licenses.
• Walk through your new home one more time with your REALTOR.
• A day or two before closing, you’ll meet with your Lawyer to sign the closing documents. Your Lawyer will tell you in advance what certified cheques you’ll need to seal the deal.

Step 18: Move in.

Moving day will come sooner than you think, so get planning now.

The boxes are mostly unpacked and you’re settling in nicely. You will now feel a strange urge to begin making changes and improvements right away. That old carpet has to go, a bigger deck would be great for entertaining… slow down! Take time to get a feel for your new home, and more importantly, your new budget. Take a deep breath and enjoy what you have, your new home.