Buying a Home in Toronto (G-T-A) Blog Series Part 4 – Best Canadian Mortgage Rates and Approvals

When you are setting out to buy a home in Toronto, there are many different things that need to be considered. One of the most important – arguably the most important – is your mortgage. Right now, interest rates are historically low, and so getting the best Canadian mortgage rate shouldn’t be a difficult task.

Getting a low interest rate on your mortgage is very important, as it can significantly reduce the amount of your monthly mortgage payment. Getting the best Canadian mortgage rate will allow you to get the most house for your money, while still allowing you to remain financially stable, even if other financial requirements should arise.

Prior to applying for a mortgage, it is essential to work out how much you can afford a month. This will ensure that you are prepared when seeking the best Canadian mortgage rate and buying a home. Making sure that you have factored in all monthly costs, such as house insurance, utilities, etc. will mean you know exactly how much you feel comfortable spending on a monthly mortgage payment.

When buying a house in Toronto and searching for the best mortgage rates in Canada, it helps knowing what different types of mortgages are available to you.  Which one you choose depends on various factors, such as the amount of down payment you have to put down or your future financial goals.

If you have 25% of the purchase price of the home or more to use as a down payment, you can apply for a conventional mortgage. If you have less that 25% but at least 5% however, you will need a high-ratio mortgage, which then has to be insured by CMHC. If you don’t have at least 5%, you have the option of applying for a no down payment mortgage, which allows you to buy a house even if you have not saved up the 5% down payment. However, be sure to keep in mind that this type of mortgage usually bears a higher rate of interest, and so getting the best Canadian mortgage rate means having a down payment.

What about an open mortgage compared to a closed mortgage option when looking for the best Canadian mortgage rates and buying a home. An open mortgage allows you to make additional payments on your monthly payment, or to pay off the entire mortgage, without any penalties. This means that if you have extra cash on hand, you do not need to worry about being charged additional fees when paying off your mortgage.

A closed mortgage (or fixed rate mortgage) is a mortgage that has an interest rate locked in for a set period of time – meaning that your rate does not change. It also means that you don’t plan on making additional payments as you would with an open mortgage. These are the most popular mortgages, as they are usually the ones that carry the best interest rates in Canada.

Knowing the different types of mortgages available to you when buying a home in Toronto and getting mortgage approval will help you to determine what you want to get from your mortgage.

For more information about buying a home in Toronto and getting the best Canadian mortgage rates available, please contact Paul Mangion by calling The Mortgage Centre at 416-204-0156 or visit www.themortgagecentretoronto.com

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

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!

For more information about what you need to know as a first time home buyer in Toronto, please contact Paul Mangion by calling The Mortgage Centre at 416-204-0156 or visit www.themortgagecentretoronto.com

Buying a Home in Toronto (G-T-A) Blog Series Part 2 - Estimating Real Estate Closing Costs

Buying a home can be a very exciting experience. However, it is important to keep in mind that there are certain real estate closing costs that you need to be aware of – and prepared for! Not knowing what other costs are associated with buying a house can be a major hassle – and may negatively impact your ability to close! Here is a list of the real estate closing costs you should be prepared for when buying a house in Toronto.

The first real estate closing cost you need is a down payment. Although there are “no down payment” mortgages available, these are often obtained at a higher interest rate, and therefore trying to save a down payment is a good idea. If you do not opt for, or cannot qualify for, a “no down payment” mortgage, you will be required to have at least 5% of the total cost of your home in the bank, and usually for 3 months, in order to secure a mortgage and buy a house. 

A second real estate closing cost that comes with buying a house in Toronto is the fee for a home inspection. Buying a house without a home inspection is a bad idea. Hiring a home inspector means that you are aware of any repairs that need to be done to the house and their expected costs.  Be sure to account for the inspection fees prior to buying a house in Toronto.

A third real estate closing cost that comes with buying a house is the legal fees charged by your real estate lawyer. A real estate lawyer is responsible for ensuring that all legal documentation is prepared and that you are protected in all contracts that you sign.  They also make sure that there are no issues, such as outstanding liens on the house, which can inhibit your ability to close. Being prepared for the costs of their services is essential!

Land transfer tax is a fourth real estate closing cost that you should be aware of. In Ontario, the cost of land transfer tax is:

-              Land/property under $55 000 = 0.5% of value

-              Land/property $55 000 - $250 000 = 1% of value

-              Land/property over $250 000 = 1.5% of value

-              Land/property over $400 000 = 2% of value

In Toronto, there is an additional land transfer tax, so be prepared for this as well.  However, new home buyers do get a substantial rebate on land transfer tax.

A fifth real estate closing cost is homeowners insurance. This insurance protects your home and property in the case of unforeseen incidents, such as fire or theft. It is usually paid on a monthly basis, but just be aware that acquiring homeowners insurance at the time of closing is a good idea, as it protects you the minute you take possession of your home! Be sure to shop around to find the best policy to suit your needs.

Being financially prepared for the costs associated with a real estate closing is very important. In order to make the home buying process a smooth and simple one, knowing your real estate closing costs is essential.  Make sure you know the costs associated with the home buying process when buying a house in Toronto and you will be able to find, buy, and close without any hassle or financial restraints!

For more information about buying a home in Toronto and the real estate closing costs you will need to be aware of, please contact Paul Mangion by calling The Mortgage Centre at 416-204-0156 or visit www.themortgagecentretoronto.com   

Buying a Home in Toronto (G-T-A) Blog Series Part 1 - The Toronto Real Estate Professionals You Will Need in Your Corner

Buying a home in the Greater Toronto Area? If so, there are many different things to consider throughout the process. Some of the most important are those people that will assist you in various areas: Real Estate Professionals!  This team of qualified individuals should include:

-              Realtor
-              Mortgage broker
-              Real estate lawyer
-              Home Inspector
-              Insurance Broker

All of these people will be necessary to you throughout the home buying process. So who are they and what role do they play in helping you buy a home in Toronto?

A realtor is the real estate professional that will help you find your dream home. Their job is to relieve you of the legwork necessary when trying to find that perfect property, pointing you in the right direction based on your predetermined list of wants/needs.  This means that you save yourself the hassle of combing through the available property listings. When you have found “your” house, the realtor will also work you through the negotiation process, allowing you to get the best deal on your new property!

A mortgage broker is the real estate professional who will help you secure a mortgage and at the best mortgage rate available in order to have the funds to buy a home. Your mortgage broker will discuss the different types of mortgages out there, and work with the different banks to obtain the greatest amount of money at the lowest interest rate possible.

A real estate lawyer is the real estate professional that will complete all of the necessary legal documentation required when buying a home. Your real estate lawyer will explain your rights and make sure that they are protected in any contracts you sign. They will make sure that there are no outstanding liens or debts against the house that can impact your ability to close.  They will also attend the closing of the home and make sure that you understand everything that has taken place.

A home inspector is the real estate professional that will make sure that the house you are planning to buy is safe to live in and that there will be no unexpected repairs necessary once you take possession of your new home. The home inspector will do a thorough inspection of the property to determine what needs to be fixed, and then you will be able to determine whether this will be fixed by the seller, if you would want to fix it yourself, or if you want to find a different house altogether. Making an offer without having a home inspection can have major consequences – and can mean great cost to you. This is easily avoided by having a home inspection done when buying a home in Toronto.

An insurance broker is the real estate professional that will make sure that your home and everything in it is protected. Homeowners insurance covers unexpected incidents such as fire, explosion, and theft, and allows you to rebuild or replace damaged items. Your insurance broker will work with you to find the best insurance policy that works for you. When buying a home in Toronto, securing homeowners insurance through an insurance broker is essential!

These five real estate professionals are very important when you are planning to buy a home in Toronto.  Making sure that you are properly covered and protected is the responsibility of all of these individuals, and buying a house without them is a bad idea! Before buying a home in Toronto, make sure you have assembled a team of real estate professionals in order to make the home buying process smooth and simple!

For more information about buying a home in Toronto and the real estate professionals you will need in your corner, please contact Paul Mangion by calling The Mortgage Centre at 416-204-0156 or visit www.themortgagecentretoronto.com