Are you a first-time homebuyer in the Greater Toronto Area? Below, we outline the steps to buying your first home:
Who could be considered a “First Time” homebuyer?
First-time homebuyers must be residents of Canada, whether as citizens or permanent residents. They must have intentions to buy a home, build a home, or enter into an agreement to do either of those things. They must also have never used the Home Buyers Plan (HBP) before—meaning neither they nor their spouse has purchased a home since January 1, starting four years ago. This means that you intend to have the home as your primary residence and not use it to rent out to tenants or keep it vacant for whatever purposes.
Who can qualify for a mortgage?
To qualify for a mortgage in Canada, you need a credit score of at least 600. Also, as recently announced by the federal government, you now need to pass a minimum stress test if your mortgage rate was at the Bank of Canada’s 5-year fixed rate.
Do: Get a pre-approval before shopping for a home.
Getting pre-approved means that you have the loan to purchase your house. Your lender has gone through the detailed process of reviewing your income, assets, credit history, and other relevant information to see if you fully qualify for the loan. Below are some advantages when you get the pre-approval first.
Sticking To Your Budget: When you are shopping for a house pre-approval always helps you to set a budget based on the amount you have approved on your mortgage. This will help you not stretching your finances too thin.
No Time Is Wasted: You will not be wasting your time shopping for houses that you won’t be able to get a mortgage on. Besides, most good real estate agents will not show you homes until you are pre-approved. They don’t want to waste your, their, or the seller’s time.
Build a team around you:
To be a successful first-time homebuyer, you should surround yourself with a team of experienced professionals who can guide you to make the right decision. Having a real estate agent in Toronto is a no brainer; they know the ins and outs of the market and can research the neighborhoods that best suit your needs. Agents can also advise you on pricing. There is also the benefit of having a good real estate lawyer; someone who can spot unfair deals and advise you on how to structure your offer. A lawyer can also let you know what conditions you should include in your offer, such as whether to strip out home inspections or not.
Lez Gomez and his team of mortgage brokers have been in the business for the past 15 years. We have been offering excellent mortgage products for First-time homeowners in GTA. If you are looking for a new mortgage solution tailored to your needs, call us today!
