7 Things You Need to Know About Buying Your First Home

7 First-Time Home-Buying Tips

1. Even a mortgage-rate discount of 0.20% can save you thousands. Your bank may say they're giving you a discount, but their rates are often higher in the first place. An expert, salaried mortgage broker can shop around for your best rate and do the lender-haggling for you (for free) while passing along a volume discount that you wouldn't normally be able to access.
2. Six federal savings programs and 20 provincial rebates or tax credits are available across Canada. Make sure to find out which ones can help with your down payment or home-buying costs.
3. You might only need a 5% down payment. That can be a big deal if you're having trouble saving up. The minimum amount depends on the home's purchase price — 5% for under $500K and less than 20% for under $1M. Thinking 'smaller' can be a better way to get something you can afford to get your foot in the (real-estate-owning) door.
4. You'll need about 2-4% of the home price for closing costs. Be aware that you'll need to cover closing costs that are over and above your down payment, such as Land Transfer Tax, adjustment costs, and lawyer fees. They can't be added to your mortgage loan and your purchase deal can fall through if you can't pay them.
5. Your score of 720 in your credit app? That's not the score lenders use. To approve you for your mortgage, lenders use your FICO score rather than the Pinnacle score you see with Equifax, TransUnion, or some other credit-score app. An expert broker can pass along your FICO score and outline if it can affect your mortgage application.
6. Don't cut out the professionals while trying to save a buck. Cheap can be expensive. Finding a good mortgage broker, realtor, and lawyer can help you gain insights and take advantage of experience to help you save money, time and stress on the right things. Ask around for a good referral, check reviews, and ask questions.
7. One financing condition on your purchase offer can save your (mortgage) butt. Even with a pre-approval in place, your mortgage isn't fully approved until after you've placed a purchase offer. Without this condition to protect you — you'll be in legal and financial trouble with the seller if you don't get the loan.

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