- July 12, 2018
- Posted by: Forever Homes
- Category: New Home
Buying a home for the first time can be like stepping off a cliff blindfolded. It is uncharted waters. But, don’t let the unknown discourage you! That jump can turn into a great adventure. Plus, buying your own home means filling it and decorating it with all things yours.
You can customize it to your wants and needs. You can create an inviting space where many memories and joyful gatherings will take place.
But, as a first-time home buyer, what should you be aware of? What does your checklist look like?
We have got you covered. Below is all things first-time home buyers should be aware of and check off their to-do list. Let’s get started.
- Your Mortgage
Most people do not have enough money to buy a home. This means you will need a mortgage. Your mortgage is a loan. Most often seek out these loans via a bank or another lender. Here’s the thing: you have to qualify for a mortgage. You have to apply and get approved. It’s best to start this process before looking at homes. Shop around, do your research, and find a good interest rate. You will be paying off your mortgage for years to come so it’s best to find a good deal. Compare bank rates to brokers. Compare different types of mortgages. Find one that works best for you.
- The Down Payment
A down payment is the money you pay up front for your new home. The more you put down, the less you will have to pay off via your mortgage. In Canada, if the home is below $500 000, 5% is the minimum down payment you need. Over $500 000 and up to $999 999, the minimum is 10%. Anything over that, the down payment is 20%. Look at your budgets and financially plan out the best down payment amount for you. Remember, there will be costs after purchase, such as bills, fees, furniture, and possibly appliances, so plan for them.
- Tax Credits
The Home Buyer’s Plan, or HBP, allows you to take out $25 000 from your RRSP to put toward your down payment, without being taxed for it. The catch? You have to repay it within 15 years.
On your taxes, you can claim the Home Buyers’ amount (Line 369). Check out the conditions to make sure you are eligible.
Get your GST/HST new housing rebate! If your house is going to be your primary residence, you are likely eligible for this.
Line 398, home accessibility expenses, and line 219, moving expenses, are also worth your time when tax season hits.
- Your Real Estate Agent
For a first time home buyer, a real estate agent can guide you through the process. They will assess what you want and hunt it down for you. They can alleviate some of the stress, such as narrowing down neighbourhoods or watching for homes for sale in certain neighbourhoods. They can also help with paperwork, home inspections, and more. A real estate agent is a fountain of information. We recommend using one, especially if it’s your first time.
- All the Little Costs
When buying a home, the little costs and fees add up fast. Be aware of them. There’s appraisal fees (often between $300-500), title insurance (this combats mortgage fraud), property taxes, and utility bills or adjustments. If you buy new furniture, that is another cost. If the house needs renovations, you will need to pay up. Don’t forget about these when financially planning. It can cause unnecessary stress or panic. Not ideal.
Do your research before house hunting. House viewings are a lot of fun. It’s an exciting time! Enjoy it, while being realistic about the costs and your budgets. Make sure to plan. Then, set out and find your dream home.
Looking to build your custom home? Contact us at Forever Homes. We can help get you there.