Buying a Home
Home buying is easy when you work with startMYplan.ca. After hundreds of satisfied customers, our system and expertise becomes your best resource for a successful experience.
Is buying a home right for you?
There’s no doubt about it — if you are considering buying a home, it can be a significant commitment. While the house-hunting process is an exciting one, there are some steps you should take first. Don’t rush into any major decisions – analyze your current financial situation and predict how it can shift in the future.
Some factors to consider are whether you are foreseeing any life changes, for instance, a job change or desire to start a family. These circumstances could affect your finances in the upcoming year. You’ll want to ensure that you have stability in your income before you proceed with the home buying process.
Another idea to consider is that you need to know if you will be able to stay in a new home for a minimum of 5 years. If you are committed to doing so, this will save you many added expenses.
Finally, you’ll need to determine whether you are comfortable handling household repairs, or have allotted the funds necessary to pay a professional if something breaks. If repairs are out of your comfort zone, you may want to give yourself more time to think about your first time buying a home.
What are the benefits of buying a home?
Buying a home has many added benefits, which is why so many people choose to purchase their very first home. When you are buying a home, you don’t have to consider a landlord and can have more freedom.
When you pay interest with your mortgage payments, these are generally tax-deductible, whereas, with rent, they are not. Mortgages have various options, meaning you can find one that works with your specific budget and create goals to ensure your monthly payment doesn’t go up when there are market changes.
How to Get Your Finances in Order
Since buying a home is one of the most significant purchases many people can make, it is vital to get your finances sorted. At sMp Mortgages, we recommend reviewing your banking information and statements to get a sense of your spending every month.
Then, determine whether your current job is stable and will provide you with enough income. For a savings plan, it’s wise to take a portion of your pay and set it aside into a savings account.
If you currently have debt, make sure that you have a plan in place for managing it. For credit card debt, make it a priority. A better credit score will assist in you receiving a better mortgage.
You never know what kind of financial emergencies can come up in your life. Be sure to set up an emergency fund that contains about three months of income. Do not use these funds for a down payment or closing processes — you should already have money set aside for these costs.
How Much to Pay for a Down Payment
If you have considered the previous factors and are ready to buy a home, you’ll want to consider the cost of a down payment. The cost for a down payment relies on the type of loan you are qualified to receive and the house’s price. However, the more you can put towards the down payment, the more you will save on monthly payments and interest. For conventional loans, they generally need a down payment of a minimum of 5% of the home’s cost.
Closing costs are also a factor you will need to consider. These fees are related to the home’s price and the mortgage type. An approximate figure is about 2% to 5% of the house’s value.
Now that you have some idea of what goes into buying a home, get in touch with the team at sMp Mortgages to find out more. Give us a call at 1-844-MY-PLAN, email us at firstname.lastname@example.org or fill out the contact form on our website.