MsGinkgo: I’m moving from midtown TO to just south of Barrie! We just went through this. This is what we did… We definitely are not experts, but it worked for us and there haven’t been any major surprises during the process.
– sort out the deposit and how its going to work. Some brokers will want to see the funds in your accounts for 3 months, prior to taking the mortgage.
– If you’re using RRSPs and the first time home buyer, read the info from the CRA. So many of the bankers, sales people, real estate people didn’t know the program very well and had no idea what the money could be used towards and what it all entailed. If you’re going to boost your RRSPs to use for your deposit, do it now. It needs to be there at least 90 days. We are doing it, the money was there, so we put it into our RRSPs and then we’ll pull it back out. The bonus is the tax return you’ll get on the 2014 tax year. (The repayment terms works out to about $65 biweekly for 15 years on 25k. (25k over 15 years is 1666/yr over 26 pays = 64 and change a pay.)
– find a broker, speak to the broker about what you’ll qualify for, what the current rate is, etc. Then run those numbers at double the rate and triple. This is because I’m crazy. But our rate is 2.3% anyone can make something work at that rate. But rates will eventually go up. We wanted to know what the numbers looked like at 5% and 8%, just in case. The broker was also able to tell us what average heating/cooling costs were on various sized houses, what our CMHC fees would be (we will not be putting down a 20% deposit.)
– Make a list of your dealbreakers/must haves, nice to haves, and rank them. For us, location ended up much lower than we thought.
– Take a look at what houses are going for in various neighbourhoods you’d like. Check out mls.ca to see photos, etc. We looked at the Guild (where I grew up), Durham Region (Ajax, Pickering), The Beach, and eventually looked way outside of town, in a very small town and near the ski hills and the lake (where we spend a lot of our off time.) Drive around, check out online for any community events, etc if you’re interested in somewhere you don’t already live.
– Take a look of what you’ll need to move. We need 5 appliances, because we went with a new build. That’s a considerable cost. We had to factor that in to our moving/closing costs.
– Find a lawyer or look for recommendations/personal references. We have a great guy, he was a recommendation from my coworker.
– Investigate property taxes, municiple by laws, etc.
– We ran the #s with various mortgage amounts to find what we liked for an overall monthly budget. We knew we weren’t going over X amount, just because we wanted to do all the things in our budget. That eliminated some areas.
– Don’t forget to factor in things like life insurance (if you don’t already have it). I have a substantial amount and didn’t need any further. My FI had to get some. We met with our insurance broker and went over our options.