Winnipeg Real Estate Market numbers are out – August MLS SALES UP 11 %
Real Estate Understanding each step of the home-buying and mortgage process is key to ensuring the biggest investment of your life matches your unique needs — now and into the future.
Jim Murphy AMP, President and CEO, CAAMP
Whether you’re in the market to purchase your first home, looking to buy another property or if it’s time to renew or refinance an existing mortgage, the services offered by a mortgage broker are truly invaluable.
This is the first expert you should consult, even before you enlist the services of a real estate agent to help you find your dream home.
The very first step is to secure a preapproval through your mortgage professional. That way, you know the amount for which you qualify prior to heading out home shopping, avoiding the risk of falling in love with a home you simply can’t afford.
Mortgage brokers are knowledgeable about the various mortgage products and rates available in today’s market, as well as the issues and trends that may affect you and your mortgage over the long term.
“If you don’t understand something your mortgage professional has explained to you, be sure to ask questions until you feel comfortable.”
When qualifying for a mortgage, there are three key variables that determine your mortgage qualification amount and interest rate:
In simple terms, this is determined by your past record of making payments. The higher your credit score the better. Be sure to pay down or pay off your monthly debts, including credit cards, lines of credit and other loans.
This is an extremely important factor when qualifying for a mortgage, so steady or rising income is to your advantage.
A lender will take into account the property being purchased, in particular its location and condition. A property appraisal will also be required.
Once a mortgage broker sits down with you in order to fully understand your income, type of work and total assets, as well as whether you’re new to Canada or self-employed, they’ll be able to then negotiate on your behalf with multiple lenders – including banks, credit unions and trust companies – based on your specific financial and credit situation.
“Although rate is important, there are many other questions that are just as critical when it pertains to your mortgage.”
And this is a service that’s generally free to the homeowner. In the vast majority of cases, mortgage brokers across Canada are paid by the lender once they successfully place your mortgage. So it’s in a broker’s best interest to ensure you receive the best possible mortgage product and rate tailored to your unique requirements.
If you don’t understand something your mortgage professional has explained to you, be sure to ask questions until you feel comfortable. The more knowledge you gain throughout the mortgage process, the more comfortable you’ll feel taking on likely the largest financial obligation of your life.
It’s important to keep in mind that, although rate is important, there are many other questions that are just as critical when it pertains to your mortgage.
Are there penalties for breaking the mortgage early? What are the prepayment options ?
These considerations can end up costing you thousands of dollars down the road if you neglect to read the lender’s fine print.
A mortgage professional’s job does not come to a close once your mortgage has been finalized. There are often updates from the Bank of Canada, the real estate market and the government that may affect a homeowner, depending on what type of mortgage you have.
Your mortgage professional will help you stay on top of that activity to ensure you’re always equipped with the mortgage to best meet your requirements throughout the life of your mortgage, not just within a single term.
Tips for New Homeowners
April 24, 2013
You found the home of your dreams, your offer was accepted, and you just received the keys to your new home. Congratulations, you are now officially a homeowner! So…what happens next?
To help you start your new life as a homeowner on the right foot, Canada Mortgage and Housing Corporation (CMHC) offers the following tips on how to protect your home – and your investment – in every season:
- The most important thing you can do to become a responsible homeowner is to make your mortgage payments on time. Late payments may result in charges and negatively affect your credit rating. Failing to make your mortgage payments can lead to even more serious consequences, including foreclosure.
- A good way to make sure you stay on time is to have your mortgage payments automatically deducted from your account every month. It’s also recommended that you keep at least three months’ worth of mortgage payments in savings for emergency situations.
- If you’re having trouble making your payments or know you will be late for an upcoming payment, talk to your mortgage professional.
- To ensure your financial peace of mind, you should also prepare a detailed monthly budget, and stick to it. If you haven’t already created a budget, use CMHC’s Household Budget as a Homeowner worksheet, available at www.cmhc.ca/homebuying, to give yourself a head start.
- Besides your mortgage, property taxes and insurance, operating a home comes with many other ongoing costs. These range from maintenance and repair costs to expenses like landscaping fees, utilities, and condominium or strata fees. Be sure you include all the costs of homeownership in your monthly budget.
- Take a few minutes each month to review your budget, check your spending and see if you’re meeting your financial goals. If you’re having trouble sticking to your budget, ask a professional money manager for help.
- No matter how far you look ahead, unexpected costs can arise at any time. So try to set aside a percentage of your take-home pay in an emergency account to help you deal with any unexpected problems, major repairs, illness or job loss.
- To keep your home safe and sound in every season, prepare and follow a regular schedule of monthly maintenance and repairs, such as the one available at www.cmhc.ca/homebuying. Carrying out a few simple repairs each month can help put a stop to many of the most common and costly problems most homeowners encounter, before they can occur.
- As a family, you should also get to know your home’s basic components, and how to adjust or turn these systems off in case of an emergency. Create a fire evacuation plan, install a smoke alarm and carbon monoxide detectors, and always keep a list of emergency numbers (including 9-1-1, the poison prevention line, your doctor, and neighbours or relatives) close to the phone.
To help you learn more about what to expect as a homeowner and all aspects of buying a home, CMHC’s Homebuying Step by Step: A Consumer Guide and Workbook will lead you through the homebuying process in five simple steps, from the moment you decide to buy a home of your own to the day the movers carry the first box through your new front door.
For over 65 years, Canada Mortgage and Housing Corporation (CMHC) has been Canada’s national housing agency, and a source of objective, reliable housing information.