Buying a home today faces new challenges than ever before. Housing prices are higher than ever, living costs are crazy, and rentals payments are as large as mortgage payments nowadays.
So how does one afford to buy a home?
Here is what you need to know about actually affording a home in Canada today.
What Are Your Options?
First thing is first. You need to find out from a mortgage professional what you can afford. Don't ballpark it, don't guesstimate, get pre-approved. This will determine whether or not a lender will consider you as a potential lendee because they may not depend on several of your financial factors.
If you are a first-time homebuyer, there are many other options for you. So make sure the first thing you do is talk to a mortgage professional and a realtor to help get you on the right path.
What's Your Credit Score?
Yes, your credit score affects what you get a mortgage for and the rate you can get. Talk to a professional on how to keep your credit score high. Talk to a professional about what you can do personally to raise your score.
Make Enough Money to Save
Making enough to save for a home can be difficult. After all the expenses, and let's be honest, some funny money, it isn't easy to have room to save unless you are a two-income home. With high living expenses, too, it can make it even more challenging.
For saving tips and our first-time homebuyer guide, please email us at email@example.com for your free guide.
Ensure you have enough saved up for closing costs, the down payment, and six months' living expenses before buying a home.
20% is Not Necessary
"Brain Blows Up"… What? Really? Yes really. Although it is preferred, it is not required. When you do not put above 20% down, you do end up paying mortgage insurance. Witch is something you may need to do in order to get into the market. Once you are in the market, it only becomes easier. So if you need to pay a bit extra for mortgage insurance, so be it.
Know Your Needs and Deal Breakers, But Remain Adaptable
You may need to downsize, and you may need to locate further away from work and commute, you may need to move closer to the south side of town, etc. Know what your boundaries are and where you might be accepting to save a buck or two.
All in all, be flexible. You might not get exactly what you want, but you can always work for it.
As mentioned above, buying a home today, whether you are already in the market or not, can be challenging. Talk to your realtor or moorage professional to make plans to work towards your dream home or even just a home to meet your financial needs.