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The home-buying process is different for everyone - but when it comes to buying a house in Toronto, there are 7 standard steps you should anticipate and prepare for: getting pre-qualified for a mortgage, developing your first time home buyer wish list, picking your team, house hunting for first time home buyers, making an offer as a first time home buyer, meeting conditions and providing the deposit, and lastly, closing the deal.

Step 1 Getting Pre-Qualified for a Mortgage

One of the first steps in buying a home is the pre-qualification process. 

 The pre-approval process, as it’s also called, is when lenders seek to evaluate several factors of your finances, such as assets, income and level of debt. It is during this process that aspiring buyers can anticipate lenders to examine their finances, to arrive at the max lending amount as well as determine the applicable interest rate. You can expect to be asked for relevant personal information and documents - and in most cases, a credit check to obtain insight on your financial history and standing. 

For your part, your lender or mortgage broker will require documents and information such as:

• Identification
• Proof you will be able to afford the down payment and applicable closing costs 
• Proof of employment 
• Information on other personal assets (things like cars, vacation properties, etc.) 
• Any information applicable to personal and outstanding debt, or arrangements of that nature 

While the pre-approval process works to determine the maximum mortgage amount you qualify for, this does not necessarily mean you will be approved by your lender for that amount. There is the possibility that, even with a pre-approval in hand, you might find yourself being turned down by lenders. Different lenders evaluate properties via criteria that can vary across the board, which means that not every lender is looking at or prioritizing the same items when examining a property for mortgage lending purposes. Refusal from a lender may also have to do with your financial history, in particular, poor credit standing. 

But hopefully buyers struggling to obtain a mortgage are not without alternative options, such as (but not limited to): 

• Seeking approval for a lesser mortgage amount
• Paying a higher interest rate on the mortgage
• Providing a higher down payment
• Obtaining a co-signer on the mortgage

The right realtor can also help you to find a mortgage lender best suited to your needs, and help you to explore your options for this crucial early step in the home buying process. 

Contact us today and let us help you get started! 

Step 2 Developing your First Time Home Buyer Wish List

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Determining your First Time Home Buyer wish list is an important step in the home buying process, as it provides you - and your realtor - with a refined list and ranking of those items in your search that are most important to you. 

This wish list should include: 

• Your absolute, non-negotiable *must-have* items (number of bedrooms and bathrooms, top areas of interest, accessibility considerations, etc.)
• Your icing-on-the-cake items, as in, those things that are not technically “deal-breakers” but would really amplify your enthusiasm and interest in a property (pool, finished basement, ensuite to the master, double-car garage, etc.)
• The “no-thank-you” items - those things that would absolutely turn you off of a property and do not serve your needs (for many, this is a pool owning to cost and maintenance, ideal layout (i.e. bedrooms on the main level), too much distance to highways and public transit, etc.)

Your wish list is likely to evolve as you go forward in your initial search and begin to see “what’s out there”. Often, once buyers are able to get an idea of properties within their budget that meet their primary needs, those “needs and wants” can get shifted around. That’s to be expected! In making your wish list, you aren’t committing to each point, but you are giving yourself a jumping off point to get started and refer back to as you go.

Step 3 Picking Your Team

House-hunting can be stressful - but it doesn’t have to be! Working with the right real estate professional will significantly reduce unnecessary stress and headaches on your part. With the right guidance, you can rest assured you have someone in place who is a professional in the industry, and who will work to represent and counsel you at every step of the way. 

Experienced real estate agents know the value in having the right resources to expand their services and custom-tailor their approach with each new client. They understand the value in building lasting relationships with professionals working in intersecting industries, such as mortgage brokers and inspectors, whom they can count as part of their expanded network, and connect with clients in need of those services. 

The relationship between buyer and REALTOR® is one based on trust, professionalism and results. You want someone you can depend on to not only guide you, but who will also keep you informed, at ease and confident throughout the process. 

Our award-winning team is here to help you in every arena of the home buying - and selling - process. 

Check out this link to find out why YOU should choose US when searching for your dream home!

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Step 4 House Hunting for First Time Home Buyers

With your mortgage pre-approval lined up, your wish list in hand and the right team behind you - it’s time to get out there and find your dream home!

The house hunting experience should, ultimately, be a fun one - as you seek out your dream home. And while major factors like housing inventory can sometimes cause frustration in your search, the right real estate professional will work to make the process as seamless and efficient as possible. 

The process will typically involve previewing online listings (filtered and selected for you for efficiency by your real estate agent) before going to view homes of interest in person. And hey, just like a bride says “yes to the dress” - odds are, you’ll get the right feeling when you finally walk into the right home - so don’t be surprised if your gut instinct plays an assisting role here, too!

Keep in mind: you’re looking for your DREAM HOME - and finding that perfect home is going to be worth the effort and time it takes. You’re going to want to keep the end goal in sight, exercise a lot of patience and aim to keep an open mind. 

House hunting will involve screening listings electronically, previewing properties online, and then finally going out to look at homes. This is your opportunity to get a feel for the different Toronto neighbourhoods, refine your wishlist, and ask questions. While a wishlist seems kind of scientific and is a useful tool in deciding which properties to visit, the truth of the matter is that most people walk into their perfect home and just feel it. Of course, it helps when it satisfies your needs and wants too, but don’t underestimate the power of ‘just knowing’.

Step 5 Making an Offer as a First Time Home Buyer

Woohoo! You’ve found “the one” and you’re ready to submit your offer! This is an exciting, and understandably, nerve-wracking, part of the process. Ontario rules and regulations stipulate your offer must come in writing via an Agreement of Purchase and Sale - the APS. This document is legally-binding and includes: 

• Your offered price 
• Deposit amount (typically 5% of the purchase price, due within 24 hours upon acceptance of the offer)
• Date of possession (also known as the Closing Date)
• Inclusions, where applicable (things currently within/on the property that you would like included in the sale - such as window dressings, washer/dryer, light fixtures, etc.)
• Conditions that the deal will be contingent upon (some conditions include: financing, home inspection, status certificate review, etc.)

Upon submission of your offer via your real estate professional, the Seller can accept it, reject it, or sign back a counter-offer and trigger negotiations that will either result in compromises on either side to reach an agreement, or meet a dead-end and have you back on the hunt. The right real estate agent will work to get you the best possible deal and end result, but it’s important to stay positive and understand that this is all part of the process. 

Step 6 Meeting Conditions and Providing The Deposit

The conditions of your deal are outlined with the Agreement of Purchase and Sale and must be met in order for the sale to go through. Once the conditions of the deal have been met, the sale is considered to be of “firm” status until the time of your Closing Date.  

Step 7 Closing the Deal

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You’re so close! Closing the deal aka Closing is when you, the new homeowner, officially take ownership and possession of the property from the Seller. This assumes all the financial and legal criteria as outlined in the Agreement of Purchase and Sale have been met, and yourself, your lender, lawyer and real estate representative have all done your part to get it done! 

And finally - CONGRATULATIONS! Time to pack! 

Are you currently looking for your dream home? Get in touch with someone from our award-winning team today. Helping YOU is what we do!

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