5 tips for first-time home buyers

5 tips for first-time home buyers

5 tips for First-Time Homebuyers

 

Introduction

First-time homebuyers can be overwhelmed by the process of buying a new home. Educating yourself is the best way on the steps involved in buying a home, then start saving money and planning ahead of time. Look for tips that will help you get started!

 

Before you start the home-buying process, you need to determine how much you can afford.

Before you get into the home-buying process, finding out how much you can afford is crucial. The following questions will help you identify how much money you need to make a monthly mortgage payment:

  • What is your current monthly rental payment? If it’s more than $2,000 per month, that’s probably too much for a first-time buyer who wants to buy—especially if they plan on saving up for a down payment.
  • How much do you want to pay in monthly mortgage payments? Experts recommend limiting this number to no more than 25% of your gross monthly income. However, I think this recommendation is not valid in this crazy house market.

 

Lenders evaluate you based on your debt-to-income ratio, or DTI.

  • The lender evaluates you based on your debt-to-income ratio, or DTI. This is the total monthly debt payments ratio to your gross monthly income.
  • The higher your DTI, the more difficult it will be to qualify for a mortgage. Your lender will look at several factors when determining whether or not they think you can afford a home payment and all other expenses:
  • How many years of employment history do you have? (If this is very low, lenders will likely ask that you put down 20% initially.)
  • What is the maximum housing expense percentage that they’re comfortable with? (For example: If they require 12%, only 12% goes toward housing each month.)
  • What are all of these other expenses? Do they seem reasonable and realistic (i.e., do they include things like food)?

 

Shop around for mortgages.

You need to shop around for a better mortgage deal. While shopping around for mortgages is essential, feel free to share the best deal you have so far(be truthful). It’s common practice for lenders and brokers to offer different rates and fees depending on the borrower’s circumstances (i.e., their credit score, employment history, and debt-to-income ratio). So if you’re offered a 6% interest rate but know someone else who got an even lower rate with similar financial information, ask why they offered such a better deal. If you’re not satisfied with the response—or if there isn’t a reason given—ask if there is any way they could do better by offering lower closing costs or other incentives within their control.

Don’t be afraid of shopping around either: The more open you are about knowing what interest rates are out there today will give your broker enough confidence in working with you that they may feel comfortable giving away some discounts without compromising his bottom line.

 

Research and compare government-sponsored first-time home buyer programs.

  • Research and compare government-sponsored first-time home buyer programs.
  • Check with your local government, real estate agent, bank or mortgage broker, employer, credit union, and financial institution for any available resources.
  • Find out what “closing costs” are before you start looking at homes. Closing costs include such items as taxes, title insurance, and legal fees that are required when purchasing a home.
  • Get a rate lock in writing from the bank or lender before making an offer on the house. If rates go up after you’ve found the perfect home but have yet to lock in your interest rate, you could lose thousands of dollars when buying your home!

 

Prepare for the typical home buying costs: Down payment, inspection fees, closing costs, home insurance cost, private mortgage insurance, etc.

These fees can add up quickly. Make sure you know what you’re getting into and have extra money saved to cover them before you start looking for a home.

Here’s a rough estimate of what your closing costs could be:

  • Down payment: 5% of the purchase price (if you’re buying a $500,000 house, that would be $25,000)
  • Closing costs: 2% to 3% of the total amount of your loan 
  • Points: 1 point = 1% interest rate reduction on your mortgage (so if you were paying 3.5%, this would reduce it by 0.5%)

 

Buying your first home can be a smooth and rewarding experience if you prepare yourself.

Buying your first home can be less stressful if you prepare yourself ahead of time. Your lender will want to make sure that you’re financially stable before they approve a mortgage for you, so here are some tips on what they’ll be looking at:

  • Credit score: Good credit before applying for a mortgage loan is crucial. A higher credit score will help you to get approved for a home loan with a favorable interest rate. Most lenders use the FICO® Score from one of two companies: Equifax® or TransUnion® (each company has its unique scoring formula). If your credit report shows late payments, low limits on credit cards, and high balances on other accounts—or if any collections are reported against your name—it could negatively affect whether or not the lender approves your application.
  • Employment/income verification: Your lender wants proof that you can afford the home-buying process by verifying how much money comes into and goes out of your account each month through paycheck stubs, tax returns, T2 Summary, and Notice of Assessments (if applicable). Bank statements are also accepted as proof of income if they show consistent monthly deposits and regular withdrawals like rent checks going out each month.
  • Loan application process timeline: The average closing time frame depends on which financial institution you deal with. However, most financial institutions require between 30 and 45 days from starting until closing.
  • CMHC FEE: If you pay less than 20% downpayment, you need to pay the CMHC fee. This fee covers part of losses incurred when borrowers default on their payments until their loans have paid off in full—but only after reaching the 80 percent loan-to-value ratio limit set forth by federal law. 

 

Conclusion

The main takeaway is that preparing and educating yourself on home-buying is a smooth and rewarding experience. Many resources are available online to help you with your search, so don’t be afraid to use them! If you’re committed to buying your first home but need help figuring out to start, consult an agent who can guide you through each process step.

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Should I Sell Or Rent My House? Maestro Tips For Homeowners

Should I Sell Or Rent My House? Maestro Tips For Homeowners

Whether you’re moving because of a new job or want to move to a new place, you might wonder, “should I sell or rent my house?”. There are many good reasons to do both, but it depends on your situation. It is often a difficult decision for homeowners, and everything has its pros and cons. Examining the important factors below can help you decide which solution is ideal for you.

Let’s undergo some pros and cons so you can better understand what might be the right course of action for you.

 

Factors to think about when making the decision.

This decision shouldn’t be taken lightly because it can completely change your financial situation. You’ll have to balance several factors when deciding whether to rent or sell your house, but it all comes down to how much money you stand to make. If you’re renting, will the monthly income from tenants be worth the effort?

And if you’re selling, how does that compare to the return on investment you could get by renting out the property and letting its value increase over time? Before you decide whether to rent or sell your home, there are a few things you should take into account.

 

When to sell your house.

Think you would possibly want to sell your house? If you fall into one of these scenarios, selling could be a better option than renting.

  • It would be best if you had cash to pay for the next house. You would possibly not be in a position to buy a new place with your current finances. During this case, you’ll need to sell the first home and then use the proceeds to pay down the new house.
  • Being a landlord requires continuous effort and can be difficult to keep up with. You would need to be available for tenants often, meaning you might not have free time. In this case, selling the house may work out better, so that home repairs and finding contractors is no longer your worry when something goes awry.
  • If you sell your home, the capital gains tax exemptions might spare you from paying taxes on $250,000 of the total sale. However, to be exempt from paying capital gains taxes on your home sale, you must prove that the house was your principal residence for at least two years before selling it.

 

When to rent your house.

In case you think renting could be a better option instead of selling. Here are some scenarios where renting may be a better idea.

  • It would be best if you had the rental income. The additional revenue from renting can help your finances. If you’re buying a new home with a mortgage, lenders will consider your income when helping you find financing. Usually, only 75% of your income can be viewed as an actual mortgage.
  • If you think that the home values in your area are increasing, you may want to rent now and sell later when prices are at their peak. Appreciation rates aren’t usually too high, so ideally, it should only take a few years – though you don’t want to wait decades as it’s just a rental property.
  • If you only plan to live in your new city for a few years before returning to your current home, then renting could be a better option than buying. With this option, you have the safety net of being able to move back into your previous home upon returning.

 

Pros And Cons Of Renting VS Selling

Weighing the pros and cons of selling or renting out your home? Here’s what you should consider.

home pros and cons

Tips for homeowners before selling their homes.

From start to finish, selling your home is generally a long and frustrating process. It’s one thing to have prospective buyers look around your house, but it’s another when they feel comfortable enough to open up your closets and poke through your belongings. Not only that, but these strangers will also criticize you and your house openly – oftentimes offering you less money than what you believe the property is worth.

For individuals with no prior experience in Real Estate transactions, making even the simplest mistake could prove costly down the line. To avoid these kinds of issues, Canadian homz is the solution for anyone looking to quickly and easily sell their home. By listing your home on the website, you open yourself up to a larger market of potential buyers who are willing to pay top dollar for your home. Also, here are a few key things every home seller should remember:

  • Keep your emotions restrained and stay focused on the business aspect.
  • Hire an agent. It will cost you in commission, but it eliminates the risk of making mistakes when promoting.
  • Set a low price.
  • Note the time of year and try to skip winter if doable.
  • Make your home look appealing in order to sell quickly 
  • Take time over your listing and add many high-quality photographs, inside and out.

 

Costs of Renting Vs. Selling your house.

Understand that there are costs incurred with both renting and selling homes. Weigh whether your rental income would manage mortgage expenses and the upkeep of two properties. Research other comparable properties in the vicinity to understand how much they charge for rent; this will give you a ballpark idea of what you can set monthly.

When you’re renting, there are a number of costs to keep in mind, including monthly rent, maintenance and repairs, hiring a property manager, and taxes.

 

Costs of renting out a house.

These are some of the costs you should be aware of when renting out a house:

  • Mortgage:  Make sure that the money you make from renting covers the mortgage of your rental house while also being prepared to pay the mortgage on a new home.
  • Property taxes: Property taxes will generally go up as your property’s value increases. It might help if you were prepared to pay for them.
  • Home repairs: Keep your tenants happy by budgeting for repairs as soon as they come up. Try to set aside 1% of the home’s value for this purpose.
  • Finding tenants: Finding tenants can be costly, between advertising and paying for credit and background checks. Keep this in mind when you’re setting your rental rates.
  • Property management fees: On average, property management companies will charge 10% of the rent.
  • Tax filing and accounting fees: Some business expenses, like tax filing and accounting fees, are expensive but necessary.
  • HOA fees: Some neighborhoods require homeowners to pay monthly HOA fees, ranging from $200 to $2,500.
  • Vacancies: Finding a new tenant may take some time, so keep that in mind when the old one moves out. Considering the months of not having a rental income might be best.
  • Landlord insurance: This type of coverage protects against damage to the property and injuries that could occur while someone is on the premises.

 

Costs of selling a house.

Similarly, when selling your house, there are a few main expenses you’ll need to take into account:

  • Renovations & additions: Many tenants prefer to rent a property that has been recently remodeled or rebuilt. You’ll also need all repairs needed. You’ll also need a pre-listing inspection to ensure the house is ready to be sold.
  • Real estate commission:  If you use a real estate agent, they will charge anywhere from 2-6% of the selling price.
  • Utilities: You are responsible for paying any outstanding utility bills until the closing date
  • Home loan payoff: The mortgage lender will be paid off using the proceeds from the sale of your home
  • Closing costs: You may have to pay some or all closing charges, which can include things like legal fees and property taxes.
  • Home staging: Making your home more attractive to buyers by adding furniture or other items. This will cost $2,500 or more.

 

Bring in experts to help you make sense of the financials.

Although it may appear easy to turn your home into a rental property, you should always consult with real estate attorneys and accountants beforehand. This ensures you follow all tax laws, zoning ordinances, and local property rules.

You might be eligible for some tax deductions, but it’s critical to know which expenses qualify as deductible. Also, there are yearly limits on how much you can deduct; therefore, the amount you claimed on your taxes for the rental activity could be different from what is actually reported.

In addition, an attorney can help you become familiar with the landlord-tenant regulations, which differ based on your state and locality.

Finally, talking with an attorney can facilitate your determining applicable house rules and emergency contacts. Price your rental property fairly by investigating other rentals in your area. Tenants often try to find the best deal, so make sure you set a competitive rent while still emphasizing all of your home’s great amenities.

 

Using Canadian Homz to maximize your profits.

Think long and hard about the question, ‘Should I sell or rent my house?’ If you decide to sell your home, you want to ensure you don’t leave any money on the table. The best way to accomplish that is to work with a professional Realtor. Canadian Homz is the best way to invest and manage your real estate portfolio. We work with you to identify, purchase, fill, and manage residential properties—so that you can enjoy up to 20% more in rental income with much less stress.

The Top 10 Must-to-Consider Factors When Buying Your Dream Home.

The Top 10 Must-to-Consider Factors When Buying Your Dream Home.

All people have an idea of what their dream home will be like. We’d make vision boards of Gothic mansions, penthouses, or Upper side apartments. Purchasing a “Dream Home” may be a top priority for many people. Whether you would like a modern urban loft or a suburban home with a white picket fence, most people hope to find a home that feels like it was made specifically for their family.

When looking for your dream home, remember that you’ll likely want to stay there for a long time. So, search for a property that will make you and your family happy in the long run. Don’t be afraid to be picky and wait until you find the right home. Before buying a house, it is essential to consider a few things, such as the mortgage, different home loans available, and your finances both before and after the purchase. Here are some tips to follow when you purchase your new dream home.

 

1. Visualize What Your Dream House Will be Like.

Now is the time to let yourself dream about your perfect home. Imagine what it might be like, without worrying about money. Give some thought to the room list your dream home should contain. You would like a bungalow or an apartment, and so on. Look at photos and listings online to get ideas.

It is key to approach this decision with a different perspective than you have in the past. In previous home-buying experiences, you were likely thinking about utility – how many bedrooms did it have, and was the commute close? But now’s the time to let your imagination run wild and consider everything you’ve ever wanted in a house location-wise and structurally. A home should be largely about fulfilling wishes rather than just practical needs that can be met elsewhere.

So don’t hesitate to make an expansive wish list! What one person may view as their idea of heaven another may find exceedingly boring – some people love waking up each morning to watch the sunrise over a calm lake while others prefer living near excitement-busting city life completely or dream of being snowed in surrounded by mountainscapes Fit for postcards day after day… At the end of the day, it’s YOUR wishlist – make it personal TO YOU. If you’re dreaming of a fitness center in your community, but your partner would rather have a secluded home, try to find something in the middle.

Home Digram

 

2. Location and Neighborhood of House Property.

It’s no secret that the location of your property plays a significant role in how much you’ll enjoy your home. The location of your home can have a big impact on your lifestyle. Living near places like schools, parks, and shopping centers will make life much easier and increase the value of your property over time. When you’re looking for a place to live, choose an advantageous location.

Is the great escape one that provides you all the peace of a secluded forest or tons of energy from a bustling city center? Do you want to be able to walk to a coffee shop each morning, or would you prefer not to have to contend with potentially noisy neighbors? Whatever your heart desires, don’t hesitate to try your research before starting your search.

Brand new homes

Is the great escape one that provides you all the peace of a secluded forest or tons of energy from a bustling city center? Do you want to be able to walk to a coffee shop each morning, or would you prefer not to have to contend with potentially noisy neighbors? Whatever your heart desires, don’t hesitate to try your research before starting your search.

 

3. The Age of Property.

When buying a home, age does matter. Each option – an older home or a brand-new one – has advantages and drawbacks. Remember what you want before submitting an offer. If you are keen on the charm of old houses, search for ones that need some TLC. If you favor newer homes, remember that they may not have the same character as older ones.

Conversely, does your ideal home need no more work than turning the key in the front door and a new master bath that looks like a spa? If so, you can choose such features as the house is being constructed and personalize it to your liking.

 

4. Your Optimal Home Style.

Picking out the right colors, materials and style will significantly impact your space’s looks and feels. Whether it’s to display your personality or to assist you in creating a more serene feel, consider what you want from your property before making any decisions. When it involves your home, it’s wise to seek a style that fits your personality and appearance. The primary thing others notice is the outward appearance of homes, so you would like the aesthetics to be on point!

Optimal Home Style

There is a vast difference between modern and Victorian single properties that have a streamlined look with clean lines and minimal design elements. As you go about your day, be mindful of the various types of homes you see. Once you see a potential home to call your own, note the styles that are a turn-off and which of them might work best for you.

 

5. Connectivity from the Major Points.

Traveling to work for long hours is one of the most frustrating things you can be forced to endure if your home is too far from your place of work. Since you are looking at settling down at this possible plot for your home, you must figure out an easy way to commute to work to avoid difficulties in the future. 

Another trivial aspect of your life is the quality time you spend with your loved ones outside work. It’s wise to look for commercial spaces such as shopping malls, movie theaters, and restaurants near your future home location to ensure you have various options for entertainment. You can also think ahead and choose areas where development is definite to happen, which will end up giving you the same comforts as the former option.

 

6. Costs That Make You Comfortable.

Having a budget in place when buying a house is essential, as it’s a hefty long-term investment. It would be best if you calculated your other expenses like car loans, education fees or loans, monthly incoming vs. outgoing, unforeseen financial requirements, etc., to use a cap on your budget.

After evaluating your financial liabilities, you’ll know the budget range and EMI you can afford. Never re-evaluate your budget, as repaying the house loan can become a nightmare, and you may not be able to enjoy the amenities you paid extra for. If you’re on a budget, exploring cheaper housing options with a reputable real estate company like Canadian Homz could be your best bet.

 

7. Inquire About the Developer.

Real estate may be a hard-selling business of late, and though many regulations are in place, we are still within the phase of organizing the real-estate sector. Therefore, before buying the right property, you must thoroughly research the builder’s profile and dig through the builder’s history. You can surf online or refer to the developer’s website and draw various insights about the developer’s reputation by looking at his earlier projects which he has delivered so far.

You can even check the status of his current under-construction projects, his goodwill amongst its earlier clients, and their reviews and experiences with the developer. This investigation will facilitate you discover the builder’s credibility and reliability to make an informed and safe investment.

 

8. Workout the Mortgage.

After determining a loose housing budget, you must decide how much you’ll be comfortable paying each month. Consider saving for a down payment if you take out a mortgage. A mortgage calculator can facilitate your estimate of your monthly mortgage payment. Remember to factor in homeowners’ insurance and property taxes when budgeting for a mortgage.

Once you have a number in mind, consult with a lender to begin the pre-qualified process. Real estate markets can be very competitive, but if you secure a loan pre-approval, you will appear stronger than other home buyers.

There are many different types of loans available at reasonable rates – select one that suits your needs, whether it has fixed interest or adjustable rates. Speak with an expert if you feel unsure about which mortgage is right for you before getting approved for one.

 

9. Is the Property Suitable for Your Business Needs?

One other important thing to think about while purchasing a property is whether it will enable you to expand your business ventures. With more people working from home nowadays, if you plan on earning money from home, ensure the house has a dedicated space where you can conduct business without distractions or noise.

Also, Make sure to check if the house you want has enough space to put in your workstation. Even better if there’s a good view from where your workstation would be located.

This factor will come in handy if your family members consider starting their own business. Having the ability to do so from home is amazing.

 

10. Talk to a Real Estate Agent.

Furthermore, it will be incredibly beneficial to you to talk to a real estate agent when finding your new home. Realtors are knowledgeable about the current market trends as well as what homes will fit your specific needs. Utilize their expertise during your search in order to gain an advantage over other buyers. A real estate agent can help with negotiating and paperwork if you’re buying a home for the first time. This will make the process smoother and more efficient.

What are you waiting for? There’s no reason to wait to make your dream a reality. Tell us about your dream home, if you’ve already found it, and what factors were critical in helping you make that decision.

 

Key Takeaways:

Observing the home of your dreams is the right of every individual. It’s possible with the right proportion of exploration. Utilize these significant elements as points of thought as you and your family start the house-purchasing process by checking houses for sale listings. They’ll assist you with the characteristics that a property should have to be your ideal fit.

Finally, after a long and difficult journey, you get to move into your new home. All the stressful aspects of buying a house are in the past, and now you get to reap the benefits by filling your home with your belongings and making it feel like yours.