Buying a home is an exciting time, as it’s often the biggest purchase of your life. Although this time is filled with anticipation and joy, it can also come with stress and worry. Once the purchase is made, trying to figure out the financial details of a mortgage can be difficult. Woolcott Realty has the top tips to make this part of the home buying process as easy as possible!
Learn as Much as Possible about Mortgages
First, spend some time finding out as much as you can about how mortgages work. There’s a whole new ‘language’ to learn: fixed-rate mortgages versus variable rates, closed versus open mortgages, etc. Know that various terms are available when it comes to mortgages and that terms can differ between banks and brokers. If you get a raise at work or a large tax return one year, will you be able to increase mortgage payments? Make sure that the agreement you make with your banker or broker is right for your individual situation.
Start Early and Do Your Homework!
Don’t leave the mortgage until after the paperwork is signed! Instead, shop around and find out which bank or broker can offer you the best mortgage pre-approval. You’ll need certain documents, including tax assessments from the last two years and a thorough accounting of your income. Although beginning the shopping process where you do your current banking is a great start, don’t feel inclined to have your mortgage there, too.
Once you find out what your financial institution can offer you as a mortgage, sit down and realistically crunch some numbers. Other than having a down payment, you will need enough money to cover closing costs for legal fees, mortgage insurance, title insurance and land transfer taxes (which cost approximately two percent of your home’s purchase price). Utility deposits will also need to be accounted for and, if purchasing a condo, don’t forget maintenance fees.
Think About Your Future
Considerations such as having a family or getting a job in another city may mean that you will be making a change in your home’s location in the future. Be sure to look into the penalties involved with breaking your mortgage, as this is the most common complaint consumers have regarding mortgage products.
Will the home require extensive renovations? If so, you may want to have access to a home-equity line of credit. Be sure to ask your banker or broker about this option if applicable to your situation.
Let Woolcott Realty Help!
We know that you count on your realtor to have the latest knowledge and expertise regarding the real estate market. Consistently ranked as the top RE/MAX team in the Hamilton-Burlington area and in the top 1% nationwide, Woolcott Realty’s team of experts work hard to ensure you get the best results possible when purchasing a home. If you have questions about the home buying process or are looking for a realtor to start the process, contact Woolcott Realty today!
Check out our mortgage calculator.