1ST TIME BUYERSFirst step – Visit your financial institution and determine how much you can afford and have the financial institution pre-approve you. When you are pre-approved, we know what price range we have to stay in and sometimes you might want to look for something less than you have been pre-approved for, especially if it might need some work. Ask your financial institution for ‘Improvement Plus’ and they will give you the details and how this works. (Keep in mind that when you are approved it is based on information that you have supplied to the financial institution, so now you have to provide them with the paperwork to get the COMMITMENT). So have the following information ready to go so that you are ahead of the game…
- T-4’s from the last 2 years
- Notice of Assessment(NOA)
- Photo copy of recent pay stubs
- A letter from your Human Resources stating that you are a full-time employee and how long you have been employed with them and how much you make a year
- Be sure to be ahead of the game as there are other buyers out there looking at the same properties and timing is everything
Third Step – Make a list of wants and do not wants and determine the area that you are interesting in living. There are a few things that might help in that, like the school for kids down the road, where you work, being close to family and friends or not or to all amenities if you do not drive as well as re-sale….you should always be thinking ahead….
Fourth Step – Once you find the house that ticks a lot of your wants, then I will step you through the offer process. When you have made this decision there are a few things that you should have in mind.
- How much of an offer do you want to put in.
- How much of a deposit do you have to put down with the offer and it can range from 500.00 to 5,000.00 depending on you and this has to be given within 24 hours after the offer has been accepted.
- What date do you want to move in-if you rent you usually have to give 60 days notice, but you can take over the house 2-3 weeks prior to you moving out of your rental so that you can go clean and paint before you start moving your possessions. This is one of those less stress things for you, pick a Tuesday to Thursday for a closing just in case there is a delay it will not cause you problems. For example if you choose a Friday and the bank is delayed in getting the funds to the Seller’s Lawyer you might not get the keys till Monday and will lose those 3 days of moving, plus interest is charged until the funds get to the Seller’s Lawyer.
- What are the inclusions, like fridge, stove, washer and dryer and what is excluded like personal items or rental items etc.
- What lawyer will you want to use and remember the closing cost are usually around 1.5% of the purchase price, for example if the house you purchased was $150,00.00 you would need at least a min. of 2250.00 for the closing costs.
- Financing-remember I mentioned the paperwork to back up your what you are pre-approved for, the financial institution now needs this paperwork as well as the Agreement of Purchase and Sale and the listing of the property(which I can send for you).
- House Inspection-determine who you will use and I know some people would rather not pay the 400.00 but being a first time buyer, it is important to have someone who knows what they are looking for and helping you to not get in over your head, in case there is something of major concern-as well as sometimes things can come up in the house inspection that can be rectified with Seller and Buyer. Book the House Inspection by the 5th to 7th day, and the reason for this is if the bank does not give you the financing I do not want you to pay 400.00 for something that is no good to you at this point…..this is a big reason for having paperwork ready for the financial institution, the sooner they have it the sooner you get your Commitment from your financial institution.
- House Insurance-they usually will want to see the listing and go through the property to make sure it is insurable, because if a house is not insurable the bank will not give you the funds to get the mortgage.
- Water and Septic-this is for the rural areas that are not on municipal water and sewer. This is important that we make sure the water is good to drink for obvious health reasons and the septic is in good working order as to replace a septic system is very costly and not a good thing for a first time buyer.
- Final Walk Through-this is done days to a week prior to closing and this to ensure that the house is in the same condition it was when you first looked at it and as well as the items included are there and if there is a problem it can be dealt with in a timely matter.
Seventh Step – Now while you are waiting to move in your new home, do not forget to give your 60 days notice in writing to your landlord that you moving(be sure to check when you have a written lease what the rules are to break your lease prior to looking for a house). Get rid of anything that is garbage and throw it out now, you will thank me later(if you have not touched or wore it in 6 months then you most likely won’t when you move), start packing and naming the boxes, so on moving day they can be put in the right rooms, so unpacking will be easy and less stressful.
Eighth Step – You will be contacted by your Financial Institution and Lawyer to go and sign papers and ensure they have all of your paper work and walk you through the process.
Ninth Step – Getting the keys from your Lawyer and now the house is yours (sort of, until you pay the mortgage off it belongs to the financial institution).
Tenth Step – Moving day has come to move everything to your new home…be sure to arrange with a moving company or rental service ahead of time and watch out for long weekends as they usually charge you more.