Buying a home is both exciting and daunting. It’s fun to dream about what life could be like and explore the market, but the process may feel overwhelming. In this homebuying checklist, we share the nine questions you should be asking about how to buy a home in Canada, so you’ll be ready to invest with confidence.
Before you start thinking about your finances or even home search, you need to know if you’re ready to buy. Talk to your family and friends, especially those who have been through the homebuying process as well. In addition to moving to a new place, you should anticipate that you’ll be owning the property you buy for a number of years. When things get stressful, having a clear idea of why you wanted to own this home in the first place will help you power through to the finish line.
Once you’re ready, start by outlining what you’re looking for in your new home. Make a list of your priorities and preferences. Many people now require a home office as a result of the pandemic, but remember to think long term. If you anticipate that you’ll be going back to the office in the next few months, you might prioritize commute time over additional space. This is the time to start monitoring the market so you can get a sense for what’s available in your area. You may also think about the features you’d be willing to compromise on.
Your credit score assesses your financial history and your current debt to calculate a number between 300 and 900. It is used by lenders to determine how much you can borrow and how much interest you’ll pay on the loan.
A real estate agent will be your partner during the homebuying process, so you’ll want someone who’s experienced, knowledgeable in your market, and understands your needs. Your agent will help you navigate the buying process and vet homes before you make an offer.
When sourcing your agent, it’s easiest to start with a service that helps you identify the most experienced and well-reviewed agents. Houseful, for example, individually checks each of its agents so you can be confident you’re in good hands.
Houseful can introduce you to an RBC mortgage specialist to help you with your home financing needs, including pre-approval. Pre-approval is a statement of how much money a lender is willing to loan you for a house and is determined by your financial situation, like income, debts, and credit score. You’ll want that pre-approval letter when making an offer on your home so the seller knows you’re able to secure the amount of money you’re offering.
Pre-approval is a statement of how much money a lender is willing to loan you for a house and is determined by your financial situation, like income, debts, and credit score.
Once your finances are in order, it’s time to start touring homes with your agent. Many homebuyers are surprised how quickly their markets move, so leverage a source like Houseful to get real-time updates of new properties on the market.
When touring a home, don’t be afraid to take your time. Your agent can help you identify any hidden damage or features that may be in need of repair. In the last year it has become more common to tour homes virtually, but you can still ask all the same questions.You may also want to drive through the neighbourhood or walk around the block to get a feel for the area.
When you find the right home for you, you’ll work with your agent to craft your offer. Your agent will look at recently sold homes in the neighbourhood to help you determine a fair offer price. Then they’ll negotiate directly with the seller and their agent on your behalf. You’ll also want to work with your agent to find a real estate lawyer who will review any documentation and investigate the property before you purchase.
Hooray, your offer was accepted! Now it’s time to take a closer look to make sure there are no surprises before the home is yours. Your agent can help you find the right home inspector to do a thorough review of the property and provide you a report on the state of the home. If there are any big surprises you may have the opportunity to renegotiate the sale price.
Once you’ve found your home, you’ll go back to your lender and finalize your loan. This means submitting records like pay stubs and bank statements for a thorough review of your finances. You’ll also need to calculate the final closing costs of the mortgage so you know how much cash—in addition to your down payment—you’ll need to close on the home.
The hard work is almost done! Before your closing date, you’ll do a final walkthrough of the home with your agent to make sure the house is as-stated, meaning it’s either the same as when you made an offer or that any agreed-upon changes have been made.
On closing day, you’ll sign the papers to put the home in your name, agree to mortgage terms, and verify homeowners insurance. Your mortgage provider can walk you through any specific documents for your market as well. When the singing is done, you’ll get the keys to your new home!
Homebuying can be a daunting process, that’s why Houseful is here providing support and guidance at every step of the way. For a new and differentiated homebuying experience, sign up at Houseful.ca.
This article offers general information only and is not intended as legal, financial or other professional advice. A professional advisor should be consulted regarding your specific situation. While the information presented is believed to be factual and current, its accuracy is not guaranteed and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the author(s) as of the date of publication and are subject to change. No endorsement of any third parties or their advice, opinions, information, products or services is expressly given or implied by Royal Bank of Canada or its affiliates.
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