Is buying a home on your 2017 to do list? Here’s a couple of tips to help make your aspirations for homeownership a reality.
It’s never too early to start saving!
The downpayment is easily the biggest obstacle homeowners need to overcome when looking to make a real estate purchase. CMHC allows buyers to have a minimum 5% downpayment saved.
No matter what the purchase price is, the sooner you start saving the better. The first step to saving for a downpayment is making a timeline. Once you’ve picked a deadline you can figure out how much you need to save from each pay cheque to have sufficient funds saved to meet your goal. Tip: It helps to set up automatic transfers from your chequing account (or wherever your pay cheque is deposited) into a savings account labelled “house” or something similar.
Establish or improve your credit score
Another factor that affects your financing approval odds is your credit score. Past loans, credit cards, vehicle purchases, and repayment behaviours can either help you, or haunt you for a long time. Ensure you use this time to check your credit score and take the necessary steps to improve it.
If you’ve never had a credit card or loan you likely do not have a credit score. If that’s the case, it’s beneficial to get a low limit credit card with no enrolment fee and start using it for a few monthly transactions. As long as you pay your total bill on time, you won’t be charged interest and your credit score will begin to climb!
Talk to a lender
It’s important to have a preliminary meeting wherever you do your banking as early in the home buying process as possible. Your lender will be able to tell you the price range that you should be shopping in according to your current, and future financial status.
Figure out what you’re looking for and be realistic!
Start compiling a list of wants and needs that you’re looking for in a house. Then, start checking out local real estate websites to see what’s available in your price range that matches your criteria. It’s important at this stage to be realistic when deciding what is a “want” and what you actually need in a house. Be reasonable and shop in your price range to avoid disappointment and frustrations in the future.
Another way to stay informed with houses that meet your criteria is the My Listings Tool. Choose your price range, location, and any other details, and properties will be emailed to you as soon as they’re on the market!
Please contact your agent, or the Choice Realty office with any questions regarding the appropriate steps to prepare for homeownership. Remember, being proactive is very important! You never know when your dream home will hit the market.