step 1: ASSESS FINANCIAL READINESS
Assess your present household budget and your annual income to determine if you are eligible for a mortgage and how much you can comfortably afford.
Our Mortgage Calculator is a great tool to get started.
WHAT DO LENDERS REQUIRE?
Mortgage lenders use two calculations to help determine your eligibility for a mortgage, your Gross Debt Service (GDS) ratio and your Total Debt Service (TDS) ratio.
Your GDS ratio is the percentage of your gross monthly income used for mortgage payments, taxes and heating costs and if you are buying a condominium half of the monthly maintenance fees. As a general rule of thumb, your GDS ratio should not be more than 32% of your gross monthly income.
HAVE YOU BEEN PRE‑APPROVED?
Getting pre‑approved for a mortgage before looking at properties gives you a more realistic expectation of what you can afford.
Pre‑approval does not guarantee you will be approved once you actually apply if market conditions, interest rates, or your personal circumstances change.
JW Team offers pre-approval for almost everyone, contact us now to learn more.
step 2: CONSIDER MORTGAGE OPTIONS
A mortgage is a loan, generally used to buy a property. How much you pay depends on how much you borrow (the principal), the loan’s interest rate, and how long you take to pay it back (the amortization period).
JW Team has a complete team of Licensed Mortage Agents with over 100 banks at your disposal. We can help you choose the best type of mortgage for you, don’t wait anymore! Take the first step to buying your dream home.
step 3: MORTGAGE DEFAULT INSURANCE
When you buy a home with less than a 20% down payment, the mortgage needs to be insured against default. This type of insurance protects the mortgage lender in case you are not able to make your mortgage payments.
This mortgage default insurance generally adds 0.6% to 3.85% to the cost of the mortgage depending on the total amount borrowed. Mortgage default insurance enables you to purchase a home with a minimum down payment of 5% (10% for multi‑unit dwellings) with interest rates comparable to those of a conventional mortgage. Our Licensed Mortgage Agents will help you make the best decision.
step 4: RESEARCH GOVERNMENT PROGRAMS
step 5: finding a home
Finding your perfect home can be a long process. Our JW Team experts will help identify the right type of home for you and continually research new listings in neighbourhoods that meet your needs.
Here are a few tips to get you started:
WHERE DO YOU WANT TO LIVE?
• Urban, suburban or country?
• Will you need to commute? Do you need access to public transit? How much will commuting cost?
• Are there schools nearby? How will your children get there?
WHAT TYPE OF HOME DO YOU PREFER?
• Single family detached homes stand alone on their own lot.
• Single family semi detached homes are joined on one side to another home.
• Duplexes contain two single family homes, one above the other.
• Row houses (townhouses) are several single family units, located next to one another and joined by common walls.
• Other types of homes include stacked townhouses, link or carriage homes, condominiums and co-op apartments.
FREEHOLD – You own the land and house and are responsible for everything inside and outside of the home.
CONDOMINIUM OWNERSHIP – You own your unit and share ownership of common spaces. The condominium association is responsible for upkeep of the building and common interior elements. You pay a monthly fee to the condominium association to cover maintenance costs.
CO-OPERATIVES – Similar to condos but instead of owning your unit, you own shares in the entire building or complex with the other residents.
step 6: making an offer
After seeing many different homes, you have finally found one worthy of an offer! What are the next steps?
WHAT IS AN OFFER?
An offer is a formal, legal agreement to purchase a home and is legally binding once accepted by the seller. Offers to purchase a home can be made conditional on factors such as financing or a home inspection.
DO YOU HAVE YOUR MONEY READY?
You will need to present a deposit along with your offer. The amount varies based on the home’s purchase price and the market.
Thanks to our more than 30 years of experience, we can guide you smoothly through this entire process until you have the keys of your home! Contact us today!
step 7: closing and related costs
HOW MUCH LAND TRANSFER TAX WILL YOU HAVE TO PAY?
The land transfer tax is a one‑time tax levied by your province when you purchase a property. The tax is based on a percentage of the purchase price of the property.
HAVE YOU BUDGETED FOR THE ASSOCIATED LEGAL COSTS?
Legal costs cover your lawyer’s fees may include:
- Reviewing the terms of the offer
- Conducting a title search on the property
- Registering a new title
- Obtaining relevant documents, such as surveys and evidence of lienson the property
- Checking the statement of adjustments for taxes, utility and fuel bills, and other costs that have been pre‑paid by the seller at the date of closing
JW Team has an experienced team of lawyers and specialists so you don’t need to hire any extra services.
DO YOU NEED A HOME INSPECTION?
A home inspector assesses a property’s condition and can tell you if something is not working properly, needs to be changed, or is unsafe. They may be able to identify where there have been problems in the past, such as a leaking basement or termite damage.
JW Team offers all the services you might need during a transaction, including home inspectors, lawyers, private lending, home staging, decorating, renovators, handymen, painters, property management and the list goes on…
We have it all, houses and mortgages, everything under the same roof!
Most of this information was developed by CREA – Canadian Real Estate Association