Whether you are buying your first home or your fifth, the process of buying a home can be an emotional, time-consuming venture. Feeling that, in the end, you made the right decision and got a good deal can make all the difference.As with most major decisions, the amount of work and research you undertake before you start shopping can have a dramatic effect on how well you do in the end.
#1 Do you really need that backyard tennis court? Everyone can picture their ideal home. If you haven’t thoroughly prepared yourself prior to viewing houses, chances are that you will find what you think is your ideal home, and will wind up paying too much for it.It is essential to treat the buying process in a slightly detached manner. Those who fall in love with houses usually pay too much.That’s why it’s recommended that you develop a list of needs and one of wants. When looking at houses, make sure that they cover all of your needs – things like adequate space, a good neighborhood, perhaps a garage – and then have fun with items on your wants list. Treating the process in a regimented manner will help you to make a rational, informed decision.
#2 Get pre-approved. Visit your lending institution prior to shopping. Be sure to get a mortgage commitment in writing. Being pre-approved gives you a solid price range, and lets your Realtor® and potential sellers know that you are serious and not just a browser.
#3 Get the right people behind you. Buying a home is a complicated process, with many people involved. Having the right people on your side can make a big difference. An experienced, dedicated, and knowledgeable Realtor® can put a team of advocates, including lenders, lawyers, home inspectors and movers, on your side immediately.
#4 Communicate. The more you share with your Realtor®, the better he or she will be able to represent you. Letting your representative know exactly what you’re looking for, in terms of needs/wants, price range, and location, can eliminate unnecessary trips to unsuitable homes and that focus can help ensure that you wind up in the right home.
#5 Location, location, location. It’s still true. The desirability and resale value of your home depend on location more than any other factor. People want a desirable community that includes character, quality of schools, access to work, major transportation arteries, recreational facilities, etc. On your viewing trips, take a careful look and ask the following questions: How does this home compare to others in the neighborhood? Are yards fenced? Are there many children playing in the streets? Are the front and back yards and the exteriors of the homes properly maintained? The less expensive houses in a better area tend to appreciate faster than the most expensive houses in a less desirable area.Additional factors that affect the property value of a home include traffic, sounds, smells, zoning bylaws, and many others. Be objective. Be sure you are completely satisfied with the neighborhood. If you choose a neighborhood with problems, you likely won’t get as much as you hoped with it comes time to sell.
#6 Use your Realtor’s® knowledge. Your Realtor® is trained in all aspects of real estate, including understanding supply and demand, economics, and the neighborhoods of the city in which they practice. A professional Realtor® can do much of the work for you, by reviewing your needs, reviewing available properties, and making an informed match. A comprehensive knowledge of the available homes in your neighborhood is one of your Realtor’s® strongest assets. With the aid of computerized systems, a Realtor® is notified within hours when a home becomes available.
#7 Pay attention to red flags. When evaluating a home, be sure you know the difference between acceptable and unacceptable problems. Cosmetic items like peeling paint, worn carpeting, or unattractive wallpaper can be easily remedied, and can be used as negotiation items, as there will be costs involved in updating the home. Major problems, however, are clearly red flags. Look for items such as major foundation cracks, water damage, outdated electrical systems, and inadequate plumbing. These items could be too expensive to remedy to make the home a worthwhile investment.
#8 Hire a home inspector. A home inspection is an inexpensive way to gain peace of mind, and guard your pocket book. A proper inspection will cover all areas of the house including foundation, electrical, heating, plumbing, floors, walls, ceilings, attic, roof, siding and trim, porches, patios, decks, garage and drainage. A professional inspector can give you an objective view of the property, with a written report, indicating the present condition and items that will need repair.
#9 Be cautious with fixer-uppers. Sometimes, a fixer-upper can be purchased below market value, and once sufficient repairs are made, can be sold at a significant profit. However, not all fixer-uppers will bring in the profits you might expect. Consumers often overestimate their level of dedication to doing extensive renovation work, and underestimate the costs associated with such work. A wall that needs to be replaced can often lead to the discovery of faulty plumbing, electrical, or other major undertakings. Your Realtor® and home inspector are your best allies when it comes to cost-benefit analyses.
#10 Consider your future needs. A move can be a major undertaking. Take a good look at your current lifestyle and consider the future. Will you need extra space for a home office, a child, or perhaps a child moving back home? Perhaps it may be easier and less expensive if you purchase a home that can meet these needs now, rather than moving up to a larger home a few years down the road.
#11 Proceed quickly. When you’re ready to buy, act. Good properties sell. This is especially true given the current state of most real estate markets. However, when you work with a Realtor®, you have access to the latest technology. As part of the MLS and Agent Handshake networks, a Realtor® has access to properties within hours of when they are listed. Technology works to your advantage. Many Realtors® now have personalized websites which allow you to sign on as a client, and receive notification of new listings via email. You save time and effort, and you can view only those homes that come closest to meeting your needs.
#12 Clarify relationships. In any real estate transaction, be very clear about who is working for whom, and what the relationship represents. Unless otherwise stated, an agent represents the seller in transactions for the sale of a home. This agent, as part of his or her fiduciary duty, must ensure that the seller’s (and not your) position is represented throughout the entire process. Get a buyer’s agent on your side, or ensure that someone is acting in your best interests.
#13 Ask for a written CMA. A Comparative Market Analysis (CMA) is an analysis of comparable homes in a given neighborhood. It shows you the sale prices of comparable homes in the neighborhood, along with asking prices of other homes in the area currently on the market. A Realtor® can request this report for any home and neighborhood. Ask for this report in writing. With this valuable document, you’ll have solid, reliable information about how fairly a home is priced compared to its real market value.
#14 Know the seller. Understanding a seller’s reasons for moving could work to your advantage during negotiations. For instance, a seller who has been transferred to another city may be more motivated to sell than someone who is still shopping for a new home. A vacant house, or a house that has been on the market for several months and has been reduced in price, could also provide the opportunity for lucrative negotiations.
#15 Keep it impersonal. Conversely, information could be used to your detriment. Information about your mortgage, size of down payment, move-in deadline, or circumstances for buying could be used to the seller’s benefit in negotiations. While you want your Realtor® to know these details, maintain your poker face and keep your cards hidden with the sellers and their agents.
#16 Measure twice, sign once. While you definitely want to move quickly once you’ve made the decision to purchase, you don’t want to cave in to pressure for a quick close. Someone who is trying to pressure you into buying a home is likely doing so for a reason. Make sure the reasons for you to buy a home are your reasons, not theirs.
#17 Exercise your negotiating skills. Even if you prefer not to haggle, it’s worth it, especially when it’s your home and one of your biggest investments. Most people expect to haggle over the price. There is always room for negotiation, and your Realtor® should be a professional negotiator.
#18 Avoid bidding wars. In some cases, the seller’s Realtor® may use scare tactics to rush the sale or increase the price. Falling for this trap could cost you money. If there is another buyer, or some other reason this pressure is being applied, whoever wins also loses because they tend to overpay. Let reason be your guide, not passion.
#19 Get it in writing. Legally, sellers must disclose all known material defects of a property. Ask for this in writing. Also be sure to consider the ramifications of these defects. Will they be costly down the road? Are they “serious” defects?
#20 Be aware of hidden costs. While Realtors® often tempt first-time buyers with rent/mortgage comparisons, there is more to a home than simply the mortgage. You will be responsible for other items including mortgage insurance, appraisal fees, legal fees, inspection fees, transfer taxes, title insurance, inspections, property tax, increased bills, etc. Your Realtor® can give you a good idea of the costs associated with buying a home that are beyond its final negotiated price.
Source: point2agent.com
Sunday, February 11, 2007
Saturday, February 10, 2007
The Advantages of Home Ownership
If you're wondering whether home ownership is right for you, a good place to start is by weighing all the ‘pros' and ‘cons'. Consider the many advantages of owning your own home. There are many practical and financially sound reasons for buying your first home, whether you start with a condo, a duplex flat, a townhouse, or even a single family home:
Home ownership is an excellent way to build equity. That's an important consideration if you're trying to build some financial stability – especially if you happen to be single and are doing it on just one income.
There's the security that comes with making an investment for the future. When you own your home, you have a resource to fall back on
Paying a mortgage off is usually better than “throwing money away” on rent. You could be paying high rents for years, adding up to many thousands of dollars, yet never end up with anything that's yours.
Your rental expenses can often be out of your control – possibly now, but particularly in the future. However, if you lock in a long term mortgage, you'll know exactly how much your payments will be for years to come.
Owning your own home gives you the option of earning extra income, either by renting out the entire property or by taking in a tenant.
Homeownership affords an asset to borrow against if you ever need to. Even if your mortgage isn't paid off, you can still borrow against the equity of your home – and at far better interest rates than you'd normally get for almost any other type of personal loan.
Property values are expected to continue to appreciate throughout 2007 and 2008, so your investment is earning a good return while you enjoy it.
There are other exciting reasons to consider home ownership. You'll gain independence and pride of ownership. The feeling of satisfaction and accomplishment it gives is one of life's great pleasures. Want to know more about the advantages of home ownership? Call me at 416-495-2256 to discuss your needs.
Home ownership is an excellent way to build equity. That's an important consideration if you're trying to build some financial stability – especially if you happen to be single and are doing it on just one income.
There's the security that comes with making an investment for the future. When you own your home, you have a resource to fall back on
Paying a mortgage off is usually better than “throwing money away” on rent. You could be paying high rents for years, adding up to many thousands of dollars, yet never end up with anything that's yours.
Your rental expenses can often be out of your control – possibly now, but particularly in the future. However, if you lock in a long term mortgage, you'll know exactly how much your payments will be for years to come.
Owning your own home gives you the option of earning extra income, either by renting out the entire property or by taking in a tenant.
Homeownership affords an asset to borrow against if you ever need to. Even if your mortgage isn't paid off, you can still borrow against the equity of your home – and at far better interest rates than you'd normally get for almost any other type of personal loan.
Property values are expected to continue to appreciate throughout 2007 and 2008, so your investment is earning a good return while you enjoy it.
There are other exciting reasons to consider home ownership. You'll gain independence and pride of ownership. The feeling of satisfaction and accomplishment it gives is one of life's great pleasures. Want to know more about the advantages of home ownership? Call me at 416-495-2256 to discuss your needs.
How to Chooose a Realtor
Whether you’re buying or selling a home, it can sometimes be a difficult task. You can make it that much easier by choosing the right realtor. Successful real estate professionals know that today’s informed and techno-savvy customers need service that goes far beyond the transaction itself. In order to succeed in today’s market, the best real estate professionals are emerging as facilitators of a comprehensive service process that encompasses the entire homeownership experience – before, during and after the sale.
When choosing a realtor, you can start your selection process by examining their track record. What companies and what salespeople have already proven their success in your marketplace? Ask lots of questions of anyone soliciting your business. Do they have experience working with your type of property and in your price range? What other business background or special skills do they have that puts them in a better position to understand and respond to the needs of today’s consumer? Are they well connected to the community and how do they keep abreast of local events that may impact property values? What other home related services can they assist you with? Can they help with creative financing options? Can they recommend trusted and reliable service providers for your home inspection, legal or moving services?
One thing you can rely on is that today’s real estate salesperson is a true professional. Industry standards and licensing requirements demand that every real estate professional completes a rigorous course of instruction and examinations before they are entrusted with your business. Ongoing education from company or industry programs further enhances their skills. When choosing a real estate representative, ask them about their training, experience and performance history. That information, combined with how clearly and how convincingly the representative builds their own case, will help you to make the right choice. After all, if a representative does a good job of convincing you, they’ll probably be just as convincing when they represent your best interests.
But while a good salesperson will offer good service, the best salesperson offers service that changes with the times. They use cutting edge technology to respond more quickly and more knowledgeably to their customers’ needs than would have been thought possible just a few years ago. They market their customers’ properties not only by posting a listing on MLS, but also through a number of online classified sites which have a tremendous amount of views everyday. Other digital marketing tactics such as personal websites and e-newsletters are all part of an effective agent’s online campaign. It's a fact that over 75% of buyers search online before visiting a single open house!!
Finally, you’ll want a sales representative who listens to you, who understands your needs, and ideally a representative who will commit to your customer satisfaction.
I am acutely aware of the need to stay on top of technology. Online advertising gives my sellers the kind of exposure that can't be achieved the print ads. When my phone rings and someone has an inquiry about one of my listings, it could be a caller from anywhere around the globe. Toronto is a destination for so many, and people start to search for their new home before they even arrive!! In addition to my real estate blog, I also have an online network of websites which displays listings from many of my associates as well. Check it out at www.bernieparent.ca
When choosing a realtor, you can start your selection process by examining their track record. What companies and what salespeople have already proven their success in your marketplace? Ask lots of questions of anyone soliciting your business. Do they have experience working with your type of property and in your price range? What other business background or special skills do they have that puts them in a better position to understand and respond to the needs of today’s consumer? Are they well connected to the community and how do they keep abreast of local events that may impact property values? What other home related services can they assist you with? Can they help with creative financing options? Can they recommend trusted and reliable service providers for your home inspection, legal or moving services?
One thing you can rely on is that today’s real estate salesperson is a true professional. Industry standards and licensing requirements demand that every real estate professional completes a rigorous course of instruction and examinations before they are entrusted with your business. Ongoing education from company or industry programs further enhances their skills. When choosing a real estate representative, ask them about their training, experience and performance history. That information, combined with how clearly and how convincingly the representative builds their own case, will help you to make the right choice. After all, if a representative does a good job of convincing you, they’ll probably be just as convincing when they represent your best interests.
But while a good salesperson will offer good service, the best salesperson offers service that changes with the times. They use cutting edge technology to respond more quickly and more knowledgeably to their customers’ needs than would have been thought possible just a few years ago. They market their customers’ properties not only by posting a listing on MLS, but also through a number of online classified sites which have a tremendous amount of views everyday. Other digital marketing tactics such as personal websites and e-newsletters are all part of an effective agent’s online campaign. It's a fact that over 75% of buyers search online before visiting a single open house!!
Finally, you’ll want a sales representative who listens to you, who understands your needs, and ideally a representative who will commit to your customer satisfaction.
I am acutely aware of the need to stay on top of technology. Online advertising gives my sellers the kind of exposure that can't be achieved the print ads. When my phone rings and someone has an inquiry about one of my listings, it could be a caller from anywhere around the globe. Toronto is a destination for so many, and people start to search for their new home before they even arrive!! In addition to my real estate blog, I also have an online network of websites which displays listings from many of my associates as well. Check it out at www.bernieparent.ca
Strong Start for 2007
February 6, 2007 -- The January resale housing market was the best January ever, registering 13 per cent more transactions than a year ago, Toronto Real Estate Board President Dorothy Mason announced today. The 5,173 sales in the month were six per cent above the previous record set in January 2002.
“Sales have been very solid to start the year,” Mrs. Mason said. “It’s a very good sign for the market to see a healthy level of activity carrying over from last year’s strong finish.”Scarborough’s Birchmount Park / Cliffside area (E06) saw 55 per cent more overall sales compared to last January, with detached homes accounting for nearly all transactions.In the Islington / Kingsway area of Etobicoke, a jump in condominium transactions helped to push overall sales 42 per cent higher than January 2006.
An increase in sales of condominiums and semi-detached homes helped lift Forest Hill to an overall increase of 56 per cent over January of last year.
North of the city, in Markham West / Langstaff (N01), 50 per cent more homes changed hands in January than during the same month a year ago.Ted Tsiakopoulos, CMHC’s Ontario regional economist, noted that Toronto’s housing market has been a very stable sector of the economy.
“The market remains resilient despite slower job growth, high energy prices, and a loss of migrants to western Canada,” Mr. Tsiakopoulos said. “Historically low interest rates, strong income growth and healthy consumer confidence are important factors keeping January home sales buoyant across the GTA.”
TREB’s President added that while the results are preliminary, they should instill confidence in consumers.
“The housing market is healthy and continues to be well supported by strong economic fundamentals,” Mrs. Mason said. “These are ideal conditions, and consumers can feel confident making a switch to another home or realizing their dream of home ownership for the first time.”
“Sales have been very solid to start the year,” Mrs. Mason said. “It’s a very good sign for the market to see a healthy level of activity carrying over from last year’s strong finish.”Scarborough’s Birchmount Park / Cliffside area (E06) saw 55 per cent more overall sales compared to last January, with detached homes accounting for nearly all transactions.In the Islington / Kingsway area of Etobicoke, a jump in condominium transactions helped to push overall sales 42 per cent higher than January 2006.
An increase in sales of condominiums and semi-detached homes helped lift Forest Hill to an overall increase of 56 per cent over January of last year.
North of the city, in Markham West / Langstaff (N01), 50 per cent more homes changed hands in January than during the same month a year ago.Ted Tsiakopoulos, CMHC’s Ontario regional economist, noted that Toronto’s housing market has been a very stable sector of the economy.
“The market remains resilient despite slower job growth, high energy prices, and a loss of migrants to western Canada,” Mr. Tsiakopoulos said. “Historically low interest rates, strong income growth and healthy consumer confidence are important factors keeping January home sales buoyant across the GTA.”
TREB’s President added that while the results are preliminary, they should instill confidence in consumers.
“The housing market is healthy and continues to be well supported by strong economic fundamentals,” Mrs. Mason said. “These are ideal conditions, and consumers can feel confident making a switch to another home or realizing their dream of home ownership for the first time.”
Finding the perfect home doesn't happen in one day. There are a number of things you can do to simplify the process, including defining financial parameters, potential neighbourhoods and the desired features in your next home.
Do you need an extra bathroom, a garage, a fenced backyard, or lower utility bills? Do you want a fireplace, a short drive to work, or maybe minimal yard work? Once your list is complete, decide what is most important to your lifestyle.
Then it's location, location, location. Location affects your day-to-day living and is one of the most significant influences on value. Your choice of location may be limited somewhat by the price you can afford. Even so, make sure you consider such things as distance to work, schools, shopping and entertainment.
What type of property do you want? A single-family detached home is attractive to many people because it typically provides more living space and land. On the other hand, a condominium may be a more appropriate choice for you, with an emphasis on maintenance-free living.
I can help you analyze all of these buying issues. As your buyer's agent I work to find the connection between homes available in the market and your needs and budget.
As your agent, I owe you the duties of utmost care, integrity, confidentiality and loyalty. I will explain how buyer agency protects you and what my obligations are.I use various tools to try and find properties that meet your specifications including the MLS® service. One of the important search tools will be the local MLS® system. By sitting down at a computer together, I can key in your needs, choice of neighbourhoods and price range and immediately come up with a list of suitable properties available through the MLS® system. You can also view listings posted to the national mls.ca web site.
When you select a property and decide to visit a house, there are many things to consider. Does it have all the features you wanted? Is the neighbourhood what you expected? Try to picture your favorite furnishings in a room. Remember all of the technical considerations:
what type of wiring does the house have?
what about power outlets? Different appliances use different types.
what type of heating system does it use?
what about the roof and foundation?
what condition are the windows in?
what about the plumbing?
There are other things to look at as well. If you don't have time or don't feel comfortable doing it, home inspection services are available for a reasonable fee. Having a qualified home inspector look at the house is always a good idea. The older the home, the greater the need for professional inspection.
Once you find the house you want to make your home, we will meet to write an offer. In the offer, you will specify how much you're willing to pay, when the offer expires, and suggest a closing date for the transaction. We will also include some conditions on the offer. Some common types of conditions are:
getting a suitable mortgage (include the amount, interest rates and any other figures you feel important);
selling your current home (the seller may continue to look for a buyer, but will give you the right of first refusal);
the seller providing a current survey, or a "real property report," showing the location of the house on the property owned by the seller and that there are no encroachments;
the seller having title to the property (your lawyer will check this out when he or she conducts a title search to see if there are any liens on the property, easements, rights of way or height restrictions);
if there is a septic system, the seller should have a health inspection certificate, stating the system meets local standards;
if you still have any doubts about the home's safety and construction, we may make the purchase conditional on an inspection by a qualified engineer; any inclusions - basically, what stays and what goes.
You will need to present a deposit along with your offer. An appropriate deposit will show your good faith to the seller. The seller's agent is bound by law to bring all offers to the seller's attention.
After your offer is accepted and all the conditions are met, the offer becomes binding on both sides. If you walk away from the deal at that point, you may lose your deposit. You may also be sued for damages. Make sure you understand and agree with all of the terms of the offer before signing.
No matter what type of home or property you're buying, plan on some extra expenses. In some provinces, you may have to pay a land transfer tax (a sales tax on property).
You may also have to pay:
a mortgage Broker's fee:
an appraisal fee;
surveying costs (if the seller couldn't come up with a current survey); and,
a high-ratio mortgage insurance premium.
an interest adjustment. Mortgages are normally calculated from the first of each month: if your closing date is the same as the beginning of your mortgage, there will be no adjustment. However, if your closing date is July and you move in on June 15, those last 15 days are the interest adjustment period. Your lender will expect you to cover the cost of the interest during that time.
You'll also have to reimburse the seller for the unused portion of any prepaid property taxes or utility bills. As well, you must also pay any legal fees. Be prepared to furnish proof to your lender that you have insured your new house as well.
Before the property can formally change hands, there are still a few things to do. On or before closing day, your lawyer and the seller's lawyer will arrange to transfer title of the property from the seller to you. The mortgage money will be transferred to your lawyer's trust account, and then to the seller, and your lawyer will bill you all additional expenses such as land transfer taxes or outstanding legal fees.
At this time, be sure to check with your lawyer that everything is as stated in the offer-to-purchase. Once you're satisfied and the keys to the front door are in your hands, there's nothing else to say... except welcome home!
(The comments contained on this site are for information purposes only and do not constitute legal advice.)
Do you need an extra bathroom, a garage, a fenced backyard, or lower utility bills? Do you want a fireplace, a short drive to work, or maybe minimal yard work? Once your list is complete, decide what is most important to your lifestyle.
Then it's location, location, location. Location affects your day-to-day living and is one of the most significant influences on value. Your choice of location may be limited somewhat by the price you can afford. Even so, make sure you consider such things as distance to work, schools, shopping and entertainment.
What type of property do you want? A single-family detached home is attractive to many people because it typically provides more living space and land. On the other hand, a condominium may be a more appropriate choice for you, with an emphasis on maintenance-free living.
I can help you analyze all of these buying issues. As your buyer's agent I work to find the connection between homes available in the market and your needs and budget.
As your agent, I owe you the duties of utmost care, integrity, confidentiality and loyalty. I will explain how buyer agency protects you and what my obligations are.I use various tools to try and find properties that meet your specifications including the MLS® service. One of the important search tools will be the local MLS® system. By sitting down at a computer together, I can key in your needs, choice of neighbourhoods and price range and immediately come up with a list of suitable properties available through the MLS® system. You can also view listings posted to the national mls.ca web site.
When you select a property and decide to visit a house, there are many things to consider. Does it have all the features you wanted? Is the neighbourhood what you expected? Try to picture your favorite furnishings in a room. Remember all of the technical considerations:
what type of wiring does the house have?
what about power outlets? Different appliances use different types.
what type of heating system does it use?
what about the roof and foundation?
what condition are the windows in?
what about the plumbing?
There are other things to look at as well. If you don't have time or don't feel comfortable doing it, home inspection services are available for a reasonable fee. Having a qualified home inspector look at the house is always a good idea. The older the home, the greater the need for professional inspection.
Once you find the house you want to make your home, we will meet to write an offer. In the offer, you will specify how much you're willing to pay, when the offer expires, and suggest a closing date for the transaction. We will also include some conditions on the offer. Some common types of conditions are:
getting a suitable mortgage (include the amount, interest rates and any other figures you feel important);
selling your current home (the seller may continue to look for a buyer, but will give you the right of first refusal);
the seller providing a current survey, or a "real property report," showing the location of the house on the property owned by the seller and that there are no encroachments;
the seller having title to the property (your lawyer will check this out when he or she conducts a title search to see if there are any liens on the property, easements, rights of way or height restrictions);
if there is a septic system, the seller should have a health inspection certificate, stating the system meets local standards;
if you still have any doubts about the home's safety and construction, we may make the purchase conditional on an inspection by a qualified engineer; any inclusions - basically, what stays and what goes.
You will need to present a deposit along with your offer. An appropriate deposit will show your good faith to the seller. The seller's agent is bound by law to bring all offers to the seller's attention.
After your offer is accepted and all the conditions are met, the offer becomes binding on both sides. If you walk away from the deal at that point, you may lose your deposit. You may also be sued for damages. Make sure you understand and agree with all of the terms of the offer before signing.
No matter what type of home or property you're buying, plan on some extra expenses. In some provinces, you may have to pay a land transfer tax (a sales tax on property).
You may also have to pay:
a mortgage Broker's fee:
an appraisal fee;
surveying costs (if the seller couldn't come up with a current survey); and,
a high-ratio mortgage insurance premium.
an interest adjustment. Mortgages are normally calculated from the first of each month: if your closing date is the same as the beginning of your mortgage, there will be no adjustment. However, if your closing date is July and you move in on June 15, those last 15 days are the interest adjustment period. Your lender will expect you to cover the cost of the interest during that time.
You'll also have to reimburse the seller for the unused portion of any prepaid property taxes or utility bills. As well, you must also pay any legal fees. Be prepared to furnish proof to your lender that you have insured your new house as well.
Before the property can formally change hands, there are still a few things to do. On or before closing day, your lawyer and the seller's lawyer will arrange to transfer title of the property from the seller to you. The mortgage money will be transferred to your lawyer's trust account, and then to the seller, and your lawyer will bill you all additional expenses such as land transfer taxes or outstanding legal fees.
At this time, be sure to check with your lawyer that everything is as stated in the offer-to-purchase. Once you're satisfied and the keys to the front door are in your hands, there's nothing else to say... except welcome home!
(The comments contained on this site are for information purposes only and do not constitute legal advice.)
Friday, February 9, 2007
The Federal Home Buyers Plan
The federal Home Buyers Plan was originally promoted by REALTORS® as a way the federal government could support home ownership. The plan was launched in 1992, and since then more than 700,000 homes have been purchased by first time home buyers using their RRSP investments.
Under terms of the Home Buyers Plan (sometimes known as the RRSP program) participants in a home buying agreement can borrow up to $20,000 from their RRSP to use in the purchase of a principle residence in Canada. Funds on deposit in an RRSP for a minimum of 90 days qualify under the plan. Almost every type of property qualifies, including a duplex, triplex, condominium, co-op, co-ownership, and mobile homes.
Because there are usually two participants involved in the purchase of each home, there can be a maximum of $40,000 available from individual RRSPs that can be used. If one spouse or partner has owned a home, but not the other, then the previous owner would not qualify and only one could apply for the Home Buyers Plan.
Individuals have 15 years to repay the RRSP withdrawal without penalty. This means 1/15th of what's borrowed is due each year, over a 15-year span (for example on a $7,500 withdrawal, that's $500 annually). Repayments can start sooner, and penalty-free prepayments are also allowed.
(The comments contained on this site are for information purposes only and do not constitute legal advice.)
Under terms of the Home Buyers Plan (sometimes known as the RRSP program) participants in a home buying agreement can borrow up to $20,000 from their RRSP to use in the purchase of a principle residence in Canada. Funds on deposit in an RRSP for a minimum of 90 days qualify under the plan. Almost every type of property qualifies, including a duplex, triplex, condominium, co-op, co-ownership, and mobile homes.
Because there are usually two participants involved in the purchase of each home, there can be a maximum of $40,000 available from individual RRSPs that can be used. If one spouse or partner has owned a home, but not the other, then the previous owner would not qualify and only one could apply for the Home Buyers Plan.
Individuals have 15 years to repay the RRSP withdrawal without penalty. This means 1/15th of what's borrowed is due each year, over a 15-year span (for example on a $7,500 withdrawal, that's $500 annually). Repayments can start sooner, and penalty-free prepayments are also allowed.
(The comments contained on this site are for information purposes only and do not constitute legal advice.)
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