Are you currently in the market for a new house? If you are, it is extremely important not to rush into things as there is a lot to think about before buying a home. It may seem like a daunting process, but if you take it slow and check all your bases, it will make everything seem a little easier.
Buying a Home is a Serious Process
Above everything else, you must remember to take the process seriously. Buying a house is a large investment and you want make sure that you get a good value for the price. You also want to be sure that you don’t overpay as well. Whether you want to buy land or a new home, you must make sure you follow the process slowly and take precaution to do everything with your best interests in mind.
Figure Out Your Budget
The first thing to pin down when you are planning to buy a new home in Canada, or anywhere for that matter, is your budget. If not a complete budget, then try thinking of around what ballpark of offers you are willing to accept. This estimation will determine the course of your buying journey and be the major impact that influences all of your options and choices.
Be Prepared to be Held Under a Microscope
Home loan lenders will look at your income, credit score, assets, and any debt you may have in order to determine whether or not to give you a loan for your new home or if you want to buy land. In order to make sure this process runs smoothly, prepare all of your financial documents and any other paperwork that may be needed.
These documents could include:
Proof of income
Bank Stubs
Tax Returns
Proof of Residency
Credit Reports
ID
Social Insurance Card
Equity
If you owned a previous home before the new one, it would be a good idea to know how much equity you have built up. Equity is the amount you had paid off on your home, in this case, the previous one. If you have a good amount of equity, then you may be able to use it to put a down payment on your new home or if you want to buy land. This will also help with the pre-approval process as well.
You Need to Cover Yourself
Unless you’re a billionaire, no amount of equity or money you have saved up can pay for a house in one go. You want to be sure that you can pay for the house in installments and live within your means. To do this properly, determine the amount of mortgage financing that you qualify for and the amount of debt that you can have and still be able to survive.
All of these terms and financial jargon probably sound confusing to the average person. This is why a realtor should at least be considered whether you want to buy land or a new house. The tips listed here are only the basics and is just food for thought before you start investing in your house. However, despite that, you’ll be a lot more at ease just knowing you can cover your mortgage payments and still afford to eat.
Author Bio- Wendy Leibowitz is a licensed Real Estate Broker working in the South Bay since 1985. She began her career with Sun Realty in Manhattan Beach. Wendy made a name for herself specializing in Single Family Residence, duplexes, and income properties 2-4 units.