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Buying a Home in Toronto (G-T-A) Blog Series Part 3 - Information for First Time Home Buyers

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Buying your first home is a very exciting process, but it can also be a very overwhelming and stressful one. Help eliminate this stress and make buying a home in Toronto a smooth and trouble-free process by following these steps for first time home buyers:

Know how much you can afford and how much you qualify for before you even start looking.  Finding a house and falling in love with it before you know how much of a mortgage you can afford and qualify for can mean heartbreak – either for you or your pocket! Set out your monthly budget and figure out what an affordable, manageable monthly mortgage payment would be.

Now it is time to get the funds to buy a house. Find a mortgage broker so that you know that you are going to get the best mortgage at the lowest interest rate. A mortgage broker will work with the different banks in order to secure this for you! They will also explain the different types of mortgages available to first time home buyers, and the advantages of each.

Make sure that you have thought about – and saved – a down payment. "No down payment" mortgages are available, but in order to secure a low interest rate and to decrease the amount of your monthly mortgage payment, having a down payment is essential when buying a house. Look at the different options available to you in order to amass that down payment, including saving or the RRSP Home Buyers' Plan, which allows first time home buyers to use up to $25000 tax free from your RRSP to purchase a home.

Secure the services of a real estate agent. These professionals will be able to help take the hassle out of buying a house that meets your needs/wants, and save you the time of having to wade through all of the real estate listings out there. Go to open houses and look at different properties, and always keep in mind that as a first time home buyer no house may seem perfect – but it may be the perfect house for you!

Know the costs associated with a real estate closing. A down payment and a mortgage are not the only costs associated with buying a home in Toronto. First time home buyers need to be aware of the various other fees that come with buying a house.  These other costs are important to remember:

-              Home Inspection – a home inspector will inspect the house to make sure that it is safe and to let you know of any repairs that are required.

-              Real Estate Lawyer – your real estate lawyer will go through all of the legal paperwork and make sure you understand your rights and responsibilities as a homeowner.

-              Land Transfer Tax – this tax is calculated based on the value of the property. There are substantial rebates on this for first time home buyers.

-              Home Insurance – required by the bank, this will protect your home and property from incidents such as fire or theft.

Buying a home – your first home – should be a very exciting experience. Just keep in mind that it is a complex process that involves some important steps that you cannot ignore. By using these easy tips to guide you in your home buying process, you can save yourself time, money and stress. Being a first time home buyer does not need to be intimidating – it should be fun – so just be prepared and take advantage of the services available to you to make it so!
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