Feeling a little wet behind the ears while shopping for your first home? Well, instead of looking listings up online, why not spend the day out and about visiting open houses in your target neighbourhoods? Even if you’re still in the window shopping phase, open houses are a great place to learn the ins and outs of your local market, refine your first time home buyer wish list, and get realistic about what you can afford based on a mortgage pre-approval. Continue reading
Tag Archives: Real Estate
Housing Types
From townhouses to triplexes, there are numerous types of properties available to Canadian consumers. Not sure what layout works best for your family? Then check out our explanation of typical housing types below. Your mortgage payments and regular monthly bills may change depending on the kind of house you acquire, therefore it is vital that you carefully weigh the pros and cons related to each design before you make your final decision.
Condominiums
Condominiums, or condominiums as they’re commonly referred to, are a popular form of housing in larger cities. Inside a condominium contract, you own the unit, but do not own the land the unit is situated on, or any of the common space (lobby, gardens, and so on) outside of your unit. In order to ensure the suitable maintenance of these areas, condo proprietors are generally charged a monthly “condo fee.” Fee’s additionally help take care of things like elevator maintenance tasks, snow removal, and the use of any onsite recreational establishments (swimming pools, work-out devices, etc.). Don’t forget, these types of monthly fees are in addition to your residence mortgage payments. Continue reading
Tips for Turning Your Home Into an Income Property
For years, people across Canada have been turning run down, old properties into money, by transforming homes into income properties. Although most people who watch home renovation or real estate television shows can picture themselves quickly fixing or transforming a property for a financial return, it isn’t always that easy. If done correctly however, renovating your first home to become an income property can help you pay your mortgage, and in the long run, make you money. Here are some things to consider before you turn your home into an income property:
Do your research first
Why would you attempt to renovate a home if you aren’t increasing or at least breaking even in the value of the home? If you plan to rent out the home, (the most common form of an income property), make sure you can meet the industry standard, which is to pay back the cost of your renovations within two years rent. If you can meet these two points, you might be ready to renovate.
Two heads are better than one
If you can, never go it alone. Entering this type of venture with a partner gives you more financial security, allows you to delegate work and tasks, and ultimately, it’s good just to have someone next to you through the highs and lows of the renovation process.
Budget, re-budget, and prepare to budget again
Once you’ve got a design and a quote from a professional contractor, make sure you plan to have a slush fund available for the unexpected. As a simple rule, the more you do in a home, the more damage or issues you might uncover. Things like faulty electrical, mould, structural issues, or any combination of troubles are not uncommon once you start opening walls. To be safe, make your budget, and then add 25% on top of the quote to help ease the surprise and stress connected to these types of issues.
Know your choices and make it liveable
Are you going to create a simple basement apartment, split your home into a duplex, or invite multiple tenants by dividing further? Larger spaces will allow you to demand a higher rent, potentially getting you nearer to mortgage free living. At the same time however, you need to make each space liveable. No one wants a bedroom that will only fit a single bed and no furniture, a kitchen with zero counter space, or a bathroom where you’re stepping over the toilet to get to the sink. Your space needs to be easy to rent, and one that will meet the needs to a variety of tenants.
Make it sound and fireproof
As soon as you welcome tenants into your income property, you’re inviting the risk of annoying sound pollution, and even added fire hazards. This is why when you’re renovating your income property, it’s important to put in quality drywall and other barriers to protect the rest of your home against sound invasion, and to serve as a fire barrier.
From the outside in
Before you worry about what tile to put down, or what colour to paint the walls, consider the entrance to your income property. Not only is this important in terms of curb appeal, but tenants typically prefer their own, secured, private entrance to a home. Shared entrances are sometimes acceptable as long as no one’s living space overlaps, but a separate, private entrance is ideal. As well, consider the surface of the entrance and safety to avoid complaints, lawsuits, or costly repairs. No one ever wants a tenant to fall down a slippery and dark stairwell on the way to their basement apartment.
There is a lot to consider before you renovate an income property. If done correctly, however, you could be on your way to mortgage free living and a future source of additional income. For more information on mortgage budgeting and real estate investing, contact the mortgage brokers at FamilyLending.ca
Chanteille Kennedy Writer for FamilyLending.ca
Making An Offer To Purchase A Home
As a first-time homebuyer, this is actually the moment you’ve been anticipating. You have discovered a home you love, and today it is time to make a proposal to buy. With all the investment going into this home, it’s a wise idea to leave the construction of your Offer to buy, also referred to as a legal contract of Purchase and Sale, up to your attorney and real estate agent.
Preparing an Offer to Purchase, or Agreement associated with Purchase and Sale, has to be done with proper care, as it is a legal document and also sets the cornerstone for the acquisition of your newhome.
The following are just some of the things you will probably need to consider when composing the Offer to Purchase:
• Your name, the name of the seller, and the accurate address of the purchase property or home. Don’t forget, this needs to be your legitimate name, as an Offer to Purchase is really a legalized document.
• Price offered and also the quantity of deposit you will place down.
• Closing particular date – In the offer to buy, the actual finishing time usually happens 30 to 60 days after the contract has been decided upon, and indicates the day you’ll take ownership of the property. Taking possession and also the “closing date” within an Offer to Purchase also symbolizes the day an individual, as the brand new owner, will be responsible for all maintenance, utilities, property taxes and insurance coverage on the house.
• A request for a current land survey of the home
• Null and Void Time – Each and every Offer to buy must expire. A null and void time is the time allocated for any vendor to take into consideration and reply to your current offer.
• Conditions on the property – Most Offers to Buy include conditions which include mortgage financing, inspection reports, as well as inclusions.
Making a proposal to Purchase often suggests the end to the long process is near. But try not to count your chickens before they hatch! It’s not uncommon to undergo a stage of settlement following your initial Offer to buy. Following this give and take goes away; you’ll be left with the excitement of a new home and the responsibility of a mortgage payment. With regard to help preparing for this financial commitment, get in touch with the mortgage brokers at FamilyLending.ca.
First-time Home Buyer Help: Mortgage Pre-Approvals and Down Payment Options
First-time Home Buyer Help: Mortgage Pre-approvals and Down Payment Options
Purchasing your first home can be a stressful experience. From listings to viewings, paperwork to inspections, there are a lot of things that first-time home buyers need to think about prior to making an offer on a potential home. Luckily, the mortgage brokers at FamilyLending.ca are here to help make your first time-home buying experience as easy as possible. This includes providing you with expert financial advice and assistance on the FamilyLending.ca blog. Today on the blog, we’ll help you understand the importance of mortgage pre-approval, as well as discuss the different types of down payment options available to first-time home buyers.
The Many Benefits of Mortgage Pre-approval
Securing a mortgage pre-approval is an important first step before purchasing your new home. Taking the time to obtain a pre-approval will demonstrate to sellers and realtors that you are a serious buyer, and could potentially help you during purchase negotiations.
A mortgage pre-approval will also help you set a realistic budget for your house hunt. This is because a mortgage pre-approval will tell you exactly how much money you can spend on your new home and what your mortgage payments will be. A mortgage pre-approval also allows you to lock in your interest rate for up to 120 days. With interest rates on the rise, it’s only logical that first-time home buyers should complete the mortgage pre-approval process as soon as possible.
Get A Mortgage Pre-Approval Now
Securing a mortgage pre-approval is easier than you think. The mortgage brokers at FamilyLending.ca can help get you pre-approved today – simply fill out our online mortgage pre-approval questionnaire to get the ball rolling.
Deciding on a Down Payment
There are many different down payment offers available to first-time home buyers. The following are three popular down payment options:
- A Conventional Mortgage A conventional mortgage requires a down payment of at least 20% and involves either a fixed or variable interest rate. Conventional mortgages are the most affordable option since they don’t have to be insured against default.
- Low Down Payment Insured Mortgage Don’t have a large down payment, but still want to buy a house? Then consider applying for a low down payment insured mortgage. Many lenders now offered this type of financing for both new and resale homes. These mortgages have a much lower down payment requirement than conventional mortgages – some are as low as 5%! The one big drawback to low down payment mortgages is that they must be insured to cover potential default of payment. These insurance premiums can be quite high, resulting in a higher carrying cost than that of a conventional mortgage.
- Cash Back Mortgage
There are options where you may receive a Cash Back option to your mortgage. This type of mortgage allows the buyer to have as little as the closing costs and 1% down payment. They tend to carry a little higher interest rate (about 1 % higher than best rates). There are other options than using cash back mortgages and best to consult with your mortgage broker.
- Using Your RRSP as a Down Payment The federal government’s Home Buyer’s Plan allows first-time home buyers to use up to $25,000 per person in RRSP savings for a down payment on a home. This means that a couple can pull a total of $50,000 from their RRSP to help fund their first home. This withdrawal is not taxable, provided you repay it within a 15-year period. To qualify, the funds you plan to use must have been in your RRSP for at least 90 days.
Talk to our Agents at Family Lending Financial for any of your RRSP questions or needs today!
Mortgage pre-approvals and down payment decisions are just a few of the factors you’ll have to consider when purchasing your first home. For more first-time home buyer help, consult with a FamilyLending.ca mortgage broker.
At FamilyLending.ca we do more than help with your financing, we make the whole home hunting process easier.
Chantielle Kennedy writer for Familylending.ca