Buying a home is a pretty eventful journey involving many bigger and smaller decisions, and having to focus on so much at once (the financing, the ideal location, the home itself, etc.), homebuyers can easily forget about minor details that later turn into headaches. To enter the market well-prepared, homebuyers need to go through all the details in advance. Here is a list of a few things homebuyers often find out on the go which can be very frustrating.
MORTGAGE COSTS GO BEYOND OF WHAT YOU PAY FOR THE MORTGAGE
When you take a mortgage, you will not only be paying back what you borrowed but also the interest on top of that. The final sum will depend on your mortgage package- interest rates, amortization period, your credit score, the amount you borrow, but it can easily be a five or six-figure amount just in interest at the end of your mortgage. This means that the total home costs are higher than the actual home's worth.
Homebuyers also need to pay attention to the loan structure as certain mortgage packages give priority to interest rates for repayment instead of the principal. This is something you want to avoid, so make sure your repayment plan goes more towards the principal than interest.
Keeping all the costs in mind, make sure not to overburden yourself by going for the maximum amount you qualify for. The golden rule is not to go over 1/3 of your monthly household income on your monthly mortgage payments.
nOt all lenders have the same terms. explore!
Many homebuyers go to their local bank when they need a mortgage, and they usually go with the rates their local bank offers them. However, exploring several other lenders (including mortgage brokers) and their mortgage packages is something every homebuyer should do. This will help you understand what the norm is, who offers the best deals and what kind of package fits you the best.
ANOTHER BUYER MAY GET THE HOME YOU WANT. don't be disappointed!
The GTA is a hot market and having to fight off fierce competition in real estate is nothing unusual. You may "lose" a home to someone with cash or you may not be as fast with your offer as someone else. It can be overwhelming having to let go of a home you thought is going to be yours. The trick is not to get attached to a property until you really reach an agreement with the seller and their agent.
Moving and furniture costs are almost inevitable
Furniture and moving costs seem very insignificant compared to the big home purchase, so many homebuyers leave this part for later (after they've dealt with the mortgage and the contract), but the reality is that if it is not planned in advance and properly, it can turn into a problem. Setting some money aside for this step is more or less a must unless you are taking your existing furniture to your new place with you.
DON'T FORGET ABOUT PARKING WHEN BUYING A CONDO
If you are looking for a GTA condo and it comes without a garage, don't forget to look at your parking options. Street parking is a good alternative, but ask your agent and the people who live there how hard it is to find a free spot. This may seem like a logical step, but the excitement over a great condo can easily make you forget to ask such and similar questions.
THE surrounding may change
Many homebuyers fall in love with the surrounding of their new home. Maybe it's a park, a great view, etc., but it may not stay that way. New developments are pretty common and they can greatly change a neighbourhood's layout, especially in fast-developing GTA, so you may want to inquire about future zoning and plans for the neighbourhood.
Buying a home is a huge commitment and all details need to fall into place for homebuyers to be completely happy with their decision. It is never too early to start planning your move and inquire about the market because when the time comes, you will be 100% prepared and ready to take it on you.
For more information on GTA homes and living, feel free to contact me.