How to Buy a Home with Confidence in today’s Hot Real Estate Market!

So you are thinking about buying a home this year?  Here are a few tips to help you as a future Home Buyer win in this crazy hot real estate market where multiple offers are the norm.

First, you want to create yourself a budget or cash flow plan and stick to it, so you can keep your finances on track.  Understanding where you are spending your hard earned money will help you identify and deal with normal and unexpected expenses whenever they come up.  Having a budget or cash flow plan will decrease your stress levels, prepare you for unexpected costs and help you plan for your future of home ownership.  If you need help with budgeting, please call or email me, I will send you a budgeting form and make other recommendations which I have personally tested.

Before you start looking at homes, meet with a Mortgage Agent, like myself, who can assist with mortgage pre-planning, so you will feel confident when you go house hunting with your realtor.  There is a misconception out there that once you have been “pre-approved”, that a lender has approved you and you have a mortgage.  This is not the case.  Most lenders and mortgage default insurers, such as CMHC, Genworth or Canada Guaranty do not provide mortgage pre-approvals.

To obtain a mortgage pre-approval, you and your realtor will feel confident with, it is important to understand what is needed to obtain a good mortgage pre-approval.

  • Your mortgage pre-approval should be properly income qualified. As a licensed Mortgage Agent, I start by completing a mortgage application and getting your income confirmation.  The documents needed for income confirmation vary depending on your employment situation.  For example, if you are salaried employee or an employee with guaranteed hours, a recent pay stub and employment letter from your employer will be enough.  If you are hourly employee, receive commission income, regular bonuses/overtime, or you are self-employed, you will need to provide additional documents.  Lenders want to see the two most recent notice of assessments (NOA’s) from Canada Revenue Agency (CRA).  For self-employed clients, additional documents will be required depending on how much income is shown on the notice of assessment but generally, lenders want at least the two most recent T1 generals which will include statement of business activity.  If you are receiving child or spousal support or paying alimony, a copy of your separation agreement will also be required.
  • The down payment you have available will be confirmed from 3 month bank/investment statements. If part of the down payment is coming from a gift of a family member, a gift letter will be prepared to be signed by the gift donor and kept with your mortgage application.  There needs to be discussions on closing costs involved in purchasing a property, such as legal costs, land transfer, title insurance, property taxes transfer costs (if applicable), appraisal costs (if applicable), home inspection.  The lenders want to see from your bank/investment statements, you have at least 1.5% of the purchase price of the home set aside for the closing costs, even if you are a first time home buyer and may be eligible for certain tax benefits.
  • After confirming income and down payment, the Mortgage professional will be able to tell you how much your mortgage payment will be and have a good idea of property taxes and condo fees (if applicable). When you know how much mortgage you can afford and how much down payment you have available, you can confidently know what purchase price of properties you are able to put an offer to purchase, without going over your monthly budget.
  • A mortgage pre-approval can secure you a guaranteed mortgage rate for 90 to 120 days. This is important if rates go up during your house hunting period.
  • Your realtor will help guide you to find a suitable property that will meet lender and mortgage default insurer guidelines. When you find a property that you are really interested in placing an offer to purchase, it is advisable to pay for a home inspection ahead of time, so you are more confident about the property you want to purchase.  This will not guarantee that your offer is accepted but it will tell the seller that you are serious about buying their property and may help you win the multiple bidding situation, when they are reviewing all the offers.

I understand in this crazy hot real estate market with multiple offers, it is important to go in with a “clean offer” where there are no conditions of financing or home inspection.   This is why it is important to speak to a mortgage professional before you start the house hunting process, who will take the extra time to look at your financial situation.  It is important for you to be honest with them, so there are no surprises when the lender reviews your application and credit bureau.

Better yet, contact me, Deborah da Silva, your local Dominion Lending Centres Mortgage Professional and have a proper mortgage pre-approval done, so you are fully prepared for what will most likely be the largest purchase in your life!  I can be reached by completing the contact form on my website or by phone 416-839-0654.

Happy House Hunting!

 

 

Why Use a Mortgage Agent or Broker?

I am often asked by prospective clients, why should they use a Mortgage Agent or Broker instead of going to their bank.  They are a lot of misunderstanding about what Mortgage Agent, such as myself, can or cannot do.  People think that it will cost them extra money to work with me or they think that I only deal with people who have bruised credit.  I want dispel the misconceptions and have you understand Why it is very beneficial for you to use a Mortgage Agent.

  • My services are free as the bank pays me a finder’s fee (OAC)
  • Access to the interest rates the banks don’t want you to know are available saving you thousands of $$$$. Since I send lenders millions of dollars of new business each month, they always offer us the deepest discounts which I pass on to you IMMEDIATELY – whether you are purchasing, refinancing or renewing
  • I shop the market saving you time – Calling me is like calling over 50 different lenders including Banks, Credit Unions and Trust Companies – I have access to all of them and so will save you time Mortgage rate shopping
  • I don’t work for any one bank, I work for you! 
  • Isn’t it time the Banks compete for your mortgage business? I’ll provide you with some options so you can compare the two – what your bank is offering you and what I am able to offer you then ultimately you decide which you feel most comfortable with. It never hurts to get a second opinion on the biggest financial obligation you will probabl y ever have 
  • Our application process is simple and quick I’ll take some information and then send it electronically to the lenders that I feel are the best fit for your situation; 24 hr turnaround is usual! 
  • Step By Step: I’ll walk you thru the process of getting a mortgage, step by step, especiallyMortgage options for the self-employed if you are a first time homebuyer – it can be daunting 
  • I’m available on your terms day, evening and weekends 
  • I take one credit bureau only but can forward your file to many lenders! Many people inadvertently disqualify themselves from getting the best rate when they are shopping for a mortgage. When multiple banks pull a credit bureau, your credit rating drops every time, sometimes eliminating the chance for the best mortgage or a mortgage at all! 
  • Large range of products. Such as self employed, credit challenged, no down payment, cottage properties, line of credit, 2nd mortgages and more 
  • I appreciate your business. I want to do an exceptional job for you because I want all your family and friends’ business in the future! 
  • I am a Licensed Expert. Deal with a mortgage expert specializing in mortgages from all lenders not just one
  • Rate Protection. If the rates drop before you close you automatically get the lower rate and if rates go up you have the lower rate locked inpiggy bank

 

  • Follow Up including Annual Mortgage Check-Ups, Variable Rate Updates and the planning of your Mortgage Burning Party!!

 

If you found this useful, please don’t hesitate to forward onto any other friends, family or colleagues you know that might also be thinking of purchasing their first home and would benefit from being informed with this information.

As always, please call Deborah da Silva at 905-239-3485 or email if you have any questions at all.

 

 

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