10-Step Guide To Home Buying In Canada
- Peter and Sharon Bare
- November 2, 2021
- 11:59 am
Starting the process of buying a home can feel really overwhelming, especially if you’re a first-time home buyer. Even though trying to find a home in the current market can feel like a race against time, it’s still always a good idea to make sure you’re not skipping any steps.
Buying a home is a huge investment so don’t compromise on doing your due diligence to keep up with the real estate flying off the market right now. Taking the time to ensure you’re set up for success will help you move quickly on a home in the future – and hopefully without any unwanted surprises.
We’ve compiled our years of realtor experience into this step-by-step checklist so that you can feel in control and confident through every stage of the process. This home buying checklist is something we usually give to our clients to help them feel like they have a roadmap of the next few months ahead of them.
Home buying checklist
Step 1: Find a Realtor
Reach out to realtors in your local area that you think will make a good fit. Sometimes you have to talk to a few agents before finding one who’s personality matches yours. It may seem silly but feeling like you “click” with each other will make communicating your wants and needs so much easier.
Qualifications your agent should have:
Maintain great credit, avoid any large purchases leading up to home buying
Pay off as much debt as you can before proceeding
Make a list of your housing goals. Prioritize!
Some questions to ask yourself once you start working with them:
Did they show up on time & prepared?
Do they communicate with you in a way that you understand and feel comfortable?
Do they have a team and support from others?
A mortgage broker can help you navigate these next few steps relating to lenders and applying for mortgage approval. Speak with your realtor, they will likely be partnered with or have a recommendation for a trusted broker.
Step 2: Find a Lender
Compare different lenders to understand the benefits of working with each
Make sure you tell EACH LENDER not to pull your credit until you’re fully committed
If necessary, create a plan with your lender to increase your credit score
Step 3: Get Pre-Approved for a Mortgage
Just because you’re approved for a certain amount doesn’t mean you have to spend that amount. Work with your lender, broker, and agent to establish a price point and monthly payment you’re comfortable with.
Saving up 20% of a home’s purchase price as a down payment is the general recommendation – but it’s only a suggestion! If saving 20% isn’t feasible, work with your lender to create a payment plan that suits your needs.
Ask the lender if you qualify for any special tax incentives, or how you could use your RRSP for a down payment
Get pre-approved; this gives you, your agent, and the lender an estimate of how much you can afford based off of your credit score and past financial documents
Work with your lender and agent to determine if your file should be underwritten before submitting any offers. This will help to avoid any potential disappointments or delays during the transaction.
Step 4: Create your home checklist
Once you’re comfortable with the realtor you’ve found, share your housing goals. Be honest! Your realtor should work with you to separate your wants from your needs, but it’s important to feel very confident about what you’ve prioritized so you know what you can and can’t compromise on.
Compare different lenders to understand the benefits of working with each
Make sure you tell EACH LENDER not to pull your credit until you’re fully committed
If necessary, create a plan with your lender to increase your credit score
Bring your pre-approval and lender contact information to your realtor meeting so you can discuss budget and have your agent connect with your chosen lender.
Have Questions?
The home buying process can be confusing and stressful, but we’re here to help!
Step 5: Finding your new home (the fun part!)
When looking at homes:
Keep your "Must-Haves" checklist in mind
Keep a journal of the different houses you're interested in
Take your own pictures to look back at
Make sure you share your thoughts about the homes your look at with your agent. Any feedback, positive or negative, can be very helpful and bring you closer to finding exactly what you want.
Also talk to your agent about how to best view new listings online. We sign our clients up for an automated search so they get properties that match their wish list straight to their inbox before they hit the public MLS site. It’s a hot market out there, setting up systems like this can help you and your agent act fast.
Once you’ve found a home you love it’s time to, make an offer.
Work with your agent to establish an offer strategy that gets you the most for your offer and has the best chance of getting accepted.
Step 6: Do your due diligence
If you need recommendations for a home inspector, ask your agent! A good inspector will ensure you don’t end up in a “money pit” property – a home that has major electrical, plumbing, or foundation issues. An inspector will also create a report of any issues found within the home that will allow you to factor repairs into your offer negotiations.
Find a reputable home inspector
Review disclosures and paperwork with your agent
Check the zoning requirements of the property with the municipal building department to make sure you’ll be allowed to make any planned structural upgrades
Step 7: Arrange home insurance
Ask your lender for recommendations if necessary.
Search for a homeowner’s insurance policy with great coverage at a reasonable cost
Double check! Some policies may not insure certain types of home construction
Step 8: Finalize financing with your lender
The lender will order an appraisal to verify the market value supports the purchase price
Double check that your interest rates and mortgage payments are what you agreed upon
Ask about early payout penalties
Step 9: Final Walkthrough
Go through the house with your agent to double check everything you agreed upon in your offer is present
Ensure that any repairs that were agreed upon in the transaction were completed
If repairs are difficult to visually inspect, call back your home inspector or a specialist to verify
Make sure to turn on all lights, appliances, heating, and A/C to make sure that they still are in good working order
Step 10: Closing the deal
Sign your mortgage documents
Meet with your lawyer to get the keys to your new home
Move in!
Double check all appliances, lights, and heating/cooling the same day that you get the keys just to make sure
Celebrate! You now own your new home!
Have any questions?
The home buying process can be confusing and stressful, but we’re here to help!
Contact us if you need any support throughout the home buying process, we’re a hands-on, full-service realty team for Carleton Place and West Ottawa area. This checklist is a great foundation, but nothing can replace an experienced realtor.