Qualifying for a mortgage
Your Royal LePage agent can arrange to have you pre-qualified for a mortgage before you start shopping for a home. It’s easy, and you’ll avoid possible disappointments down the road if you fall in love with a place, then find out you can’t afford it. Plus, once you do find the perfect home, it will mean you can make an offer immediately.
Here’s how mortgage approval works: the amount of money you qualify for, plus the amount of cash you can put down equals the amount you can afford to spend on a home. Most lending institutions won’t allow more than about 30% of your income to support a mortgage. If you have other debts, they usually won’t allow your debts and your mortgage to exceed 40% of your income.
Finalizing your mortgage
Once you’ve found the home you want to buy, you’ll need to finalize your financing. You’ll need to provide your lender with the following documents:
1. A copy of the real estate listing of the property. If the home is still to be built, the mortgage lender will need to see the architect’s or builder’s plans and details on lot size and location.
2. A copy of the offer to purchase or the building contract, if this document has been prepared.
3. Documents to confirm employment, income and source of pre-approval.
4. If you have a pre-approved mortgage, it’s a simple matter of finalizing a few details with your mortgage specialist.
8 things to look for when you buy
When you fall in love with a home, the things you like about it can blind you to its problems. Next time you go to an open house or tour a property with an agent, keep your eyes open with these top tips:
1. Take a look at general upkeep. Is it clean? Are lawns left uncut? Do walls need paint? If the small stuff hasn’t been taken care of, there’s a good chance that bigger issues have been ignored as well.
2. Test it. Try out lights, faucets, toilets, air conditioning and major appliances.
3. Check for water damage. Look at ceilings and drywall for stains and bulges. Water that works its way in through a leaky roof or a cracked foundation can rot wood, create mildew and destroy possessions.
4. Watch for "spongy" floors. Take note of soft, springy sections, squeaky or uneven areas - these can be a sign that costly floor repairs are needed.
5. Check doors and windows. Make sure they fit snugly in their jambs and operate smoothly. Feel for drafts. Look for flaked paint and loose caulking - if wood isn’t protected from moisture, it will rot.
6. Look at the foundation. If you see deep cracks or loose mortar and bricks, there may be a significant structural problem. Soggy areas near the foundation are also a warning sign.
7. Make sure there’s enough storage space. If you are moving from a home with large closets and a shed, make sure your new house is able to store an equivalent amount of belongings.
8. Measure. Make sure your furniture will fit into your new house.
These tips are for your own first (or second) look at a home. For true peace of mind, you should always hire a certified home inspector before you buy.
Options for empty nesters and retirees
The kids have grown and retirement is just around the corner. You’ve decided it’s time to move to a smaller home with lower costs and less maintenance.
Figure out what you need
You have a number of decisions to make before you start looking for your new home:
- Do you want to stay in the same neighbourhood? If not, remember that moving away means you may have to build a new network of acquaintances, find a new doctor, get to know a new area, etc.
- If you decide to move out of your neighbourhood, where would you like to go? A better neighbourhood within the city? A community outside a major center? Someplace closer to your kids? Somewhere warm?
- What type of property would suit your lifestyle? Is it a condo that needs no upkeep or a bungalow that would still allow you to garden?
Condos - less work, more rules
Short on maintenance and long on amenities, the condominium lifestyle is a favourite of empty nesters and retirees. Condominium apartments and townhomes are available in almost every neighbourhood and price range. Many offer pools, tennis courts and fitness areas - some even include golf courses. It’s an easy, hassle-free arrangement.
However, owning a condo means you’re governed by the rules and regulations established by the condominium board. Generally, these rules are necessary to ensure the enjoyment, safety and cleanliness of the building; when you’re doing your research, you may want to find out about the condo bylaws, especially if you have a pet.
Bungalows - small homes with big rewards
Bungalows offer the best of both worlds - a detached house and a yard, with less space to take care of. It’s a great way of preparing for the future, since living with fewer stairs makes it easier to get around should you slow down a little.
Retirement communities - a neighbourhood of friends
Adult lifestyle communities offer smaller homes, amenities often associated with condo living, and the opportunity to live with like-minded people. They tend to be resort-like in nature, and are built in rural areas that are close to large urban centres. Units range from apartments to detached homes. The focal point is the clubhouse, where you’ll likely find fitness facilities, tennis courts, games rooms and swimming pools. Some areas also feature golf courses.
If you’re not sure what option is best for you, please contact me. I’d be happy to talk to you about the possibilities that are available to you.
Types of home ownership
What type of home is right for you?
There are three categories of home ownership: freehold, condominium and cooperative. Each has its benefits and drawbacks - speak to your Royal LePage agent to figure out which type will work best for your needs and your lifestyle.
Freehold homes offer two significant benefits: freedom of choice and privacy. Since you own the structure and grounds, you’re free to decorate and renovate whenever and whatever you want. However, all maintenance (indoors and out) is your responsibility - be prepared to spend time and money taking care of your home.
Condominiums are typically less expensive to own than a detached house. With a condo, you own (and are responsible for) the interior of your unit. Upkeep of the building and grounds is handled by the condominium association, which is funded by monthly fees collected from tenants. The down side? Condo residents enjoy less privacy than residents of detached homes, and often have to adhere to strict rules regarding noise, use of common areas, renovations, etc.
Co-ops are like condominiums, except instead of owning your unit, you own a percentage of shares in the entire building. One drawback to living in a cooperative is that if you decide to sell your shares and move out, the co-op board has the right to reject your prospective buyer.