Buying Your Home Guide

Step 0: Decide if you are ready to become a homeowner:

There are many advantages of becoming a homeowner and one of the most obvious ones is financial stability and having a permanent home. When you buy your own place you will have the peace of mind of not having to worry about the landlord increasing rent or in certain cases being evicted. There is nothing more satisfying than owning the place you live in where you can have full control of customizing it to your own personal taste. Besides the freedom factor of owning real estate, it is also considered a safe investment. Instead of paying rent (Money you will never see again), you are paying monthly mortgage payments that are going towards your mortgage principal which builds your equity in the property. Plus you also have the annual appreciation in the value of the property.

Step 1: Get Pre-approved for a Mortgage

This is the most crucial step of the home buying process because it will let you know how much house you can afford and how much your monthly payment will be. Oftentimes new homebuyers look for homes that fall outside their budget. That’s why it is really important to know the maximum loan amount you can qualify for before you start looking because it will help you narrow down your search and avoid disappointments.

To get preapproved for a mortgage you have the option of either going to the bank directly or working with a mortgage broker. Mortgage brokers are always the better option because they have the ability to connect with multiple financial institutions and lenders to shop for the best possible interest rate. Not only that but they could also advocate for you to potentially qualify for a larger loan amount which means more purchasing power. A good mortgage product would include a lower interest rate, prepayment options and less restrictive penalties. 

See my Mortgage guide here.

Step 2: Work with a Real Estate Agent

There are a number of things that a real estate agent can help you with during the buying process. A real estate agent:

  • Uses his expert knowledge of real estate and the local housing market to help find you a home that is tailored to your needs. 
  • A realtor will work with you closely to narrow down your search to be able to make a buying decision with confidence that there are no other homes better available in the market.
  • Explain forms and terms used in a real estate transaction.
  • Write offers on your behalf and present them to a seller.
  • Help get your offer accepted in a multiple offers scenario using expert negotiating tactics.

Step 3: Start the Search

This is the fun part of the homebuying process. Now you know how much you can afford, you are able to go shopping for the home that meets your criteria. Generally, these are the housing types that are most common to choose from:

  • Single-family detached
  • Duplexes
  • Townhouse
  • Apartments

Think about the housing type that is more suitable for your needs at the present time. Your income level and your qualified mortgage amount will determine what housing category is more suitable for you. That is why it’s important to keep an open mind when you are looking at your home options.

It is recommended that you create a list of the things that “you must have” and a list of the things that are optional or in other words, known as “nice to have”. For example, a person might view an updated kitchen as a must-have feature in an apartment while another person may view it as an optional feature as long as the apartment is located within walking distance to his/her work. Depending on your lifestyle, here is a list that will help you brainstorm:

A must-have list may include :

  • Location (Proximity to work/school)
  • Number of Bedrooms and Washrooms
  • Air Conditioning

A nice-to-have list may include:

  • Swimming pool
  • Spacious backyard 
  • Balcony & waterfront views

Start attending open houses and visualize yourself living in that place. If you have emotionally connected with the home and the price is rational then it’s a good sign that it is the right home for you.

Step 4: Making an offer

Now you have found the home that fits your budget and your needs, it is time to move forward and make an offer and make a deal with the seller.

Your realtor will help you draft an offer with all the conditions that are necessary and important to you. The offer, also known as the contract of purchase and sale (CPS), will include the following:

  • The legal name names of the buyer and the seller
  • The address of the property
  • The purchase price
  • Deposit if any
  • Included items. For example appliances or drapes
  • Conditions that must be met. For example satisfactory home inspection and lender approval of financing
  • Closing date (usually 30-60 days after the offer is signed)
  • Date the offer expires

It’s important to keep in mind that an offer is a legally binding contract after it is signed. Meaning that you will be obligated to perform the terms of the contract and that you will have to go to court if you decide to walk away.

Despite submitting an offer with the asking purchase price, a seller is not obligated to accept your offer. Alternatively in a multiple offer scenario, if the market is too hot, your offer might not be accepted. Therefore it’s important to hire an expert Realtor to help you win the home you fell in love with. 

Schedule a call with Ahmed here.

Step 5: Subject (Condition Precedent) Clauses Removal

After your offer is accepted, this is the period between the time when your offer is accepted and the time when you take possession of your new home. These subject clauses are conditions that must be fulfilled before completing your home purchase. Common “Subjects” to include:

  • Arrangement of the financing you require
  • Satisfactory home inspection
  • Satisfactory review of all relevant strata documentation (for condos and townhouses)
  • The sale of your present home

It’s important to note that the subject clauses are not “escape” clauses so be sure not to use them as a way to avoid your legal responsibility of the contract. Keep in mind that the fewer subjects you put in an offer,  the more serious you will show. Thus, increasing the chance that your offer is accepted by the seller.

Step 6: Completion (closing) Date

Once all the conditions have been fulfilled, or in other words removed, a lawyer or notary public will prepare the necessary documents to transfer the legal ownership. In this stage the lawyer or notary will make sure that the following is done:

  • Prepare the documents to transfer ownership from the seller to you
  • Ensure that the seller’s old mortgage has been discharged
  • Prepared ”Statement Of Adjustments” to outline all the money you owe to complete the transaction 
  • Prepare Strata Documents (for Condos and Townhouses):
    • Form B: the Information Certificate.
    • Form F: the Certificate of Payment.
    • Strata corporation’s Certificate of Insurance.
  • Deliver the money held into the trust account to the seller and ensure that you are the new registered owner.
  • Arrange for you to sign the transfer documents 

Step 7: Possession Date

This is the big day when you do a final walkthrough of the property and receive the keys to your new home. You are now a proud homeowner, Congratulations!

Looking to buy a home?
Whatever property type you are looking for and whatever budget you are working with, I will walk you through every step of the way to make sure you get exactly what you are looking for.
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