Sept. 13, 2017 | Tyler Difley

Buying a home: step by step

Buying a home is a momentous occasion in anyone's life. Thankfully, Canada Mortgage and Housing Corp. has some suggestions that can help you navigate the ins and outs of the home-buying process.

• Upfront costs (e.g., down payment, closing costs, taxes)


• Ongoing costs (e.g., mortgage payments, property taxes, insurance, utilities, condo fees, routine maintenance)


• Major repairs (e.g., roof replacement, foundation repair)

• There are benefits and drawbacks to both renting and owning a home – make sure you understand them before you decide which option is right for you

• Calculate how much you can afford to spend on housing each month without putting your financial health at risk


• Your monthly housing costs should be no more than 32 per cent of your average gross monthly income


• Your monthly debt load should be no more than 40 per cent of your average gross monthly income

• Have you saved enough money to cover a down payment, home inspection and appraisal, insurance costs, land registration fees, prepaid property taxes or utility bills, legal or notary fees, potential repairs and renovations, moving costs, and GST?

• This lets you know how much you can afford, your interest rate and what your monthly mortgage payments will be

• Contact information for your employer


• Proof of address


• Government-issued photo ID


• Proof of income


• Proof of down payment (amount and source)


• Proof of savings and investments


• Details of current debts

• Lenders and brokers will look at your credit history before deciding whether to approve you

• Required if your down payment is less than 20 per cent of a home's purchase price

• Location


• Size


• Special features


• Lifestyle

• Freehold


• Condominium (strata)


• Leasehold


• Co-operatives

• Via word of mouth, social media, newspaper and real estate magazines, visits to new housing developments, real estate websites, "for sale" signs, and/or a REALTOR®

• Real estate agents


• Insurance brokers


• Home inspectors


• Appraisers


• Land surveyors


• Builders or contractors


• Lenders or mortgage brokers


• Lawyers or notaries

• Your legal name, the seller's name and the address of the property


• Purchase price


• Amount of your deposit


• Any items you want included in the purchase


• Closing date


• Request for a current land survey


• Date the offer expires


• Any other conditions

• Legal description of the property


• Building specifications


• REALTOR.ca listing


• Property tax assessment


• Appraisal


• Home inspection report


• Land survey


• Heating and utility costs


• Condo fees


• Signed offer to purchase

• Take legal possession of your new home

• You can make your payments weekly, bi-weekly or monthly


• Late or missed payments can lead to penalties, and negatively impact your credit rating

• Maintenance and repair costs, security monitoring, snow removal,
  gardening, etc.

• If you regularly spend more than you earn, find ways to cut your spending or increase your earnings

• Set aside an emergency fund of roughly five per cent of your income every year to deal with unexpected expenses

Tagged: buying | Canada Mortgage and Housing Corporation | CMHC | Feature | homebuying | How To | How To