First-Time Homebuying
Resources to succeed as a first time homebuyer.
First-Time Homebuying
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Fulfill the Dream of Homeownership: Resources to Succeed as a First-Time Homebuyer
Buying your first home marks a significant milestone in your life, brimming with excitement and the promise of new beginnings. For many young professionals across Canada, the dream of homeownership represents not just a personal achievement but a rite of passage into financial independence. However, this dream often comes with its share of complexities and challenges. The path to homeownership is fraught with financial commitments and procedural hurdles, turning what should be a joyous journey into a daunting endeavor.
Understanding the Challenges
The decision to purchase a home is one of the biggest financial commitments you will ever make. The process involves a myriad of tasks, steps, and requirements, from securing a mortgage to navigating property markets. For many aspiring homeowners, the journey is anything but straightforward. Unexpected challenges can arise, causing confusion, anxiety, and the fear of making costly mistakes. The dream of homeownership, while enticing, can quickly become a labyrinth of financial and bureaucratic obstacles.
The Role of a Mortgage Broker in Your Homebuying Journey
In the complex world of real estate and mortgages, having a trusted guide by your side can make all the difference. This is where a mortgage broker steps in. Unlike traditional financial advisors or bank representatives, a mortgage broker works for you, not the financial institutions. Everything Mortgages brings a unique approach to the table, with a team of experienced brokers who are committed to demystifying the homebuying process for you.
Personalized Guidance and Support
Your Everything Mortgages Broker is more than just a financial advisor; they are your partner in the homebuying journey. With a deep understanding of both your long-term financial goals and current financial status, they offer personalized guidance tailored to your unique situation. The relationship between a client and their broker is built on trust, with your best interests at the forefront of every decision and recommendation.
Navigating the Homebuying Process with Everything Mortgages
Embarking on your homebuying journey with Everything Mortgages means you’re never alone in navigating the complexities of the process. Our brokers provide step-by-step guidance, answering your most daunting questions and mitigating any challenges that arise. From understanding mortgage options to securing the best rates, we simplify the journey, making it less intimidating for first-time homebuyers. Our goal is to make your dream of homeownership a reality, without the stress and confusion that often accompanies it.
Why Choose Everything Mortgages for Your First Home Purchase
Choosing Everything Mortgages as your partner in the homebuying process means leveraging the expertise and experience of a team that has facilitated over 5,000 mortgages. Our brokers are dedicated to providing personalized advice and solutions, ensuring you find the right mortgage to fit your needs. We offer a simplified process, access to a wide range of mortgage options, and a commitment to securing the best possible outcome for our clients. Our track record speaks for itself; we are here to help you fulfill your dream of homeownership.
Self Employed Mortgage
If you are a self-employed professional, consultant, or small business owner, securing a mortgage may seem challenging. Traditional lenders often have strict requirements that may not align with your unique financial situation. At Everything Mortgages, we specialize in self-employed mortgages and understand the complexities involved. Our team will work with you to find the best financing strategies tailored to your needs, ensuring you can achieve your dream of homeownership.
First-Time Homebuying
As a first-time homebuyer, the process of buying a home can feel overwhelming. From understanding mortgage terms to navigating the real estate market, there are many factors to consider. At Everything Mortgages, we provide you with the tools, advice, and support you need to make informed decisions. Our experienced brokers will guide you through the entire process, ensuring you understand your options and helping you secure the best rates and loan terms available.
Mortgage Refinance
If you already own a home and are looking to refinance your mortgage, Everything Mortgages can help. Our team will review your current mortgage terms and work with our network of lenders to secure better rates and potentially save you money. Whether you want to reduce your monthly payments, shorten your loan term, or access equity for other purposes, we will find the best refinance options for your specific needs.
Bad Credit Mortgage
Having bad or new credit doesn’t mean homeownership is out of reach. At Everything Mortgages, we offer assistance to individuals with credit challenges. Our team will explore alternative lending solutions and programs designed to help you secure a mortgage, even if you have new or bruised credit. We believe that everyone deserves the opportunity to own a home, and we are committed to finding the best mortgage options available for you.
Why Choose Us?
We Simplify Your Home Loan: Forget the tedious phone calls and lengthy email threads. Our online process makes getting a mortgage easy and convenient, saving you time and reducing stress. Apply online in minutes.
We Work Hard So You Don’t Have To: We understand that your time is valuable. That’s why we do the legwork for you. We work with over 35 lending institutions to get you the best rate and loan option, saving you thousands. Invest minutes now, and we’ll invest hours in helping you move forward.
We Represent Your Interests: At Everything Mortgages, we prioritize your goals and interests. Our team of licensed experts will support you every step of the way, ensuring that we find the mortgage that suits your needs. You can trust us to have your best interests at heart.
We Have a Proven Track Record: With over 5,000 mortgages under our belt, we have the experience and expertise to handle even the most complex situations. Our track record speaks for itself, and we are confident that we can help you fulfill your dream of homeownership.
Conclusion
The journey to buying your first home should be filled with excitement, not anxiety. At Everything Mortgages, we understand the challenges faced by first-time homebuyers and are committed to providing the guidance and support needed to navigate the process with confidence. If you’re aspiring to own a home, let us help you make informed decisions every step of the way. Contact Everything Mortgages today for a consultation and take the first step towards making your dream of homeownership a reality. Your dream home is closer than you think!
Frequently asked questions
Where should I start ?
The best place to start is to determine how much you can afford to borrow. The mortgage amount you qualify for will depend on how much you earn, have saved for a down payment and your outgoing expenses. It's best practice to know how much money you have in your wallet before you start shopping around for properties. You can do this by getting a mortgage pre-approval with us.
Can I really only afford how much online calculators and banks are telling me?
Recent changes to mortgage lending (i.e. the stress test) have made it more difficult to qualify in recent years. But, there’s still hope yet. We use a creative approach to find the solution that’s best for you. As your broker, we have access to a portfolio of over 35 lenders including banks, alternative and private lenders.
Why should I work with a broker vs. a bank?
As your mortgage broker, we represent your interests and take the time to understand your entire story. We’re not tied to one specific lender nor do we have a hidden agenda. We’ll guide you through the homebuying process and give you the advice, strategy and tools you need to succeed as a first time homebuyer. Plus, it’s a service that’s at no cost to you.
What is the minimum down payment?
Minimum down payment for your first home purchase is 5% of the first $500,000 and 10% on anything above that.
Down payments can consist of your savings, RRSP's of up to $35,000 per applicant (first-time homebuyers only or if you've recently separated), gifted down payment, inheritance, and to clarify, can still even be borrowed (i.e from a line of credit or loan).
Down payments can consist of your savings, RRSP's of up to $35,000 per applicant (first-time homebuyers only or if you've recently separated), gifted down payment, inheritance, and to clarify, can still even be borrowed (i.e from a line of credit or loan).
What is the difference between a deposit and a down payment?
A deposit is a sum of money you pay up front to secure, or commitment to move forward with your accepted purchase and sale agreement. The deposit is typically held in trust by the Buyer's Agent’s real estate office. The down payment is the money that you pay to the seller to be eligible for financing.
The deposit is generally part of the down payment. If the down payment is $40,000 and you give a $20,000 deposit, that $20,000 would count towards the total down payment.
The deposit is generally part of the down payment. If the down payment is $40,000 and you give a $20,000 deposit, that $20,000 would count towards the total down payment.
How do I make an offer?
Once you find the house that you want to make home, you’ll work with your realtor to submit your offer to the sellers. With your pre-approval and qualification information you’ll show sellers that you’re serious and confident about your home purchase.
What is a fixed rate mortgage?
A fixed rate mortgage is when the interest rate is set for a predetermined term - usually between 6 months to 25 years. This offers the security of knowing what you will be paying for the term selected.
What is a variable rate mortgage?
A variable rate mortgage is when payments are fixed for a period of one to two years although interest rates may fluctuate from month to month depending on market conditions. If interest rates go down, more of the payment goes towards reducing the principal; if rates go up, a larger portion of the monthly payment goes towards covering the interest.
What is a pre-approved mortgage?
A pre-approved mortgage is an interest rate guarantee from a lender for a specified period of time (usually up to 120 days) and for a set amount of money. The pre-approval is calculated based on information provided by you and is generally subject to certain conditions being met before the mortgage is finalized.
The pre-approval amount is the maximum you may get. It does not guarantee a mortgage for that amount. The approved mortgage amount will depend on the value of the home, your down payment and income information.
Most real estate professionals will want to ensure you have a pre-approved mortgage in place before they take you out looking for a home. This is to ensure that they are showing you property within your affordable price range.
The pre-approval amount is the maximum you may get. It does not guarantee a mortgage for that amount. The approved mortgage amount will depend on the value of the home, your down payment and income information.
Most real estate professionals will want to ensure you have a pre-approved mortgage in place before they take you out looking for a home. This is to ensure that they are showing you property within your affordable price range.
What is the process to get approved?
It’s easy to get started! The first step will be information gathering which will take merely minutes to complete. From there, our team will work hard to underwrite a mortgage pre-approval for you.
We’ll also provide you with an in-depth lender comparison report and discuss every option available to you. You'll also learn about the resources provided and your next steps up to and after your first home purchase.
With our digital mortgage management portal, you can sign-in to your unique profile where you can update your profile, verify information, upload documents, track your loan status and communicate with your advisor, anywhere, anytime.
We’ll also provide you with an in-depth lender comparison report and discuss every option available to you. You'll also learn about the resources provided and your next steps up to and after your first home purchase.
With our digital mortgage management portal, you can sign-in to your unique profile where you can update your profile, verify information, upload documents, track your loan status and communicate with your advisor, anywhere, anytime.
What are the closing costs?
We will ensure to outline your unique closing costs based on your situation. Some of the associated closing costs may include:
Land Transfer Tax
You will be required to pay a one-time tax based on a percentage of the purchase price of the property and/or mortgage amount. As a first-time homebuyer, you'll enjoy up to a $4,000 land transfer tax credit applied against the total on closing.
If your down payment is less than 20%, then you will need to pay PST on the mortgage default insurance (known as CMHC).
Real Estate Legal Fees, plus Lawyer’s disbursements
These fees will vary from lawyer to lawyer, budget for $2,000 to be conservative.
Home Inspection
$500 to $800. Optional costs but strongly recommended to have it done. It is usually placed as a condition to the Offer to purchase. The inspection may bring to light areas where repairs or maintenance are required. Usually the inspector will provide you with a written report. If they don't, then ask for one.
Appraisal
$300 to $500. An optional cost however some lenders would prefer to appraise the home before granting the loan.
Land Transfer Tax
You will be required to pay a one-time tax based on a percentage of the purchase price of the property and/or mortgage amount. As a first-time homebuyer, you'll enjoy up to a $4,000 land transfer tax credit applied against the total on closing.
If your down payment is less than 20%, then you will need to pay PST on the mortgage default insurance (known as CMHC).
Real Estate Legal Fees, plus Lawyer’s disbursements
These fees will vary from lawyer to lawyer, budget for $2,000 to be conservative.
Home Inspection
$500 to $800. Optional costs but strongly recommended to have it done. It is usually placed as a condition to the Offer to purchase. The inspection may bring to light areas where repairs or maintenance are required. Usually the inspector will provide you with a written report. If they don't, then ask for one.
Appraisal
$300 to $500. An optional cost however some lenders would prefer to appraise the home before granting the loan.
What is mortgage insurance?
Mortgage loan insurance is a type of insurance provided by Canada Mortgage and Housing Corporation (CMHC), a crown corporation, and GE Capital Mortgage Insurance Company, an approved private corporation. This insurance is required by law to insure lenders against default on mortgages with a loan to value ratio greater than 80%. The insurance premiums, ranging from .50% to 3.75%, are paid by the borrower and can be added directly onto the mortgage amount.
How can I get the land transfer tax credit?
First-time homebuyers in Ontario can qualify for a rebate equal to the full amount of their land transfer tax, up to a maximum of $4,000.
Based on the Ontario land transfer tax rates, the rebate will cover the full tax amount up to a maximum home purchase price of $368,333. For homes with purchase prices over $368,333, homebuyers will qualify for the maximum rebate, but will still owe the remainder of their land transfer tax. If you are buying your home with your spouse, but only one of you qualifies for this rebate, you can still receive 50% of the rebate.
Based on the Ontario land transfer tax rates, the rebate will cover the full tax amount up to a maximum home purchase price of $368,333. For homes with purchase prices over $368,333, homebuyers will qualify for the maximum rebate, but will still owe the remainder of their land transfer tax. If you are buying your home with your spouse, but only one of you qualifies for this rebate, you can still receive 50% of the rebate.
What are the qualifications for being considered as a first time home buyer and can I use my RRSPs?
You are considered a first-time homebuyer if you or your spouse or common-law partner have not owned a home in the last for years.
Each applicant can withdraw up to $35,000 from their RRSPs, tax free, to put towards a down payment on your first home. These funds can be used for any homebuying costs including land transfer tax, legal fees, home furnishing, etc.
Your RRSP contributions must stay in the RRSP for at least 90 days before you can withdraw them under the HBP. If this is not the case, the contributions may not be deductible for any year.
You can also withdraw from your RRSP up to 30 days after your home purchase (closing). However, there can only be one withdrawal, whether before or after.
Each applicant can withdraw up to $35,000 from their RRSPs, tax free, to put towards a down payment on your first home. These funds can be used for any homebuying costs including land transfer tax, legal fees, home furnishing, etc.
Your RRSP contributions must stay in the RRSP for at least 90 days before you can withdraw them under the HBP. If this is not the case, the contributions may not be deductible for any year.
You can also withdraw from your RRSP up to 30 days after your home purchase (closing). However, there can only be one withdrawal, whether before or after.
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