Frequently Asked Questions
Step 1: Meeting with your Real Estate Agent. Your agent can help you to figure out if the time is right for you to buy. Your agent will walk you through the home buying process from A to Z, and hold your hand for as long as you need it held. Your real estate agent will be the most important person in your life until the day you close. Step 2: Go Shopping for a Mortgage. It may seem backwards to shop for a mortgage before you shop for the house, but there are several reasons for doing this. First, you’ll find our how much you can borrow, which has a lot to do with how much house you can buy. Be careful not to let the lender you push you into a monthly payment you don’t feel comfortable with. There are no “rules” here – only you know how much you can comfortably handle. Step 3: Now find your new home. Start searching for homes in your desirable and affordable area with your agent and arrange showings to see inside the homes till you find your ideal home. Step 4: Ask your agent to prepare an offer. don’t fall in love with the house. You may not get it. Based on the other houses you’ve seen and recent sales of comparables, make a reasonable offer. You don’t have to offer asking price, but if you "lowball," the seller may tell you take a hike. Find out, if you can, what the seller’s circumstances are. If they’ve been waiting for years and are holding out for the best price, you may not have much room to negotiate. On the other hand, if they’ve already bought another house, they may be more “flexible.” Tailor your offer accordingly. Step 5: Once your offer is accepted (congratulations, by the way), you need to provide a deposit (based on the agreement) by a bank draft payable to Listing brokerage Trust account in next business day after acceptance of the offer (Unless otherwise is mentioned your agreement of purchase and sale). Step 6: Find a good Real Estate Lawyer and send the documents to his/her office. Step 7: Submit your mortgage application. Step 8: Apply for home insurance at lease one week before closing. Congratulations! You’re now in debt beyond your wildest dreams! If after a few days or weeks you find yourself thinking you’ve made the biggest mistake of your life, don’t worry: it’s called “buyers remorse” and lots of new homeowners contract this disease. Give it time, watch your mortgage principal go down and enjoy the freedom of not paying rent into someone else’s bank account.
When budgeting for a new home loan, it’s important to know how much your mortgage payments will be. Go to www.TOREES.com/Mortgage-Calculator To figure out how much will be your monthly payment based on the purchase price and the down payment. This calculator will consider the Mortgage insurance in your payments if your down payment is less than 20%.
Mortgage loan insurance is typically required by lenders when homebuyers make a down payment of less than 20% of the purchase price. Mortgage loan insurance helps protect lenders against mortgage default, and enables consumers to purchase homes with a minimum down payment of 5% — with interest rates comparable to those with a 20% down payment. To obtain mortgage loan insurance, lenders pay an insurance premium. Typically, your lender will pass this cost on to you. The premium payable is based on a percentage of the home’s purchase price that is financed by a mortgage. The premium can be paid in a single lump sum or it can be added to your mortgage and included in your monthly payments. Mortgage loan insurance is not to be confused with mortgage life insurance which guarantees that your remaining mortgage at the time of your death will not be a burden to your estate.
Closing costs are fees associated at the closing of a real estate transaction. The closing point is when the title of the property is transferred from the seller to the buyer. Closing costs vary widely based on where you live and the property you buy. They often include things such as: 1- Land Transfer Tax 2- Lawyer Fee 3- Title Insurance (Highly recommended) 4- Lender Fee (Occasional) 5- Balance of Property Tax (Occasional) 6- Appraisal Fee (Occasional)
Title insurance is an insurance policy that protects you, the home owner, against challenges to the ownership of your home or from problems related to the title to your home. The policy provides coverage against losses due to title defects, even if the defects existed before you purchased your home. A title defect is a problem with the title which prevents free and clear ownership. There are many types of defects such as rights of way, encroachments (from neighbouring properties), unpaid liens, etc. Title insurance policies protect you for as long as you own the property. It protects against a number of risks that a solicitor's opinion on title may not cover. These risks include: 1- Fraud and forgery, including someone taking your title through fraud or forgery 2- Encroachments that would be disclosed by a new survey (for example, a neighbour's deck being partly on your land) 3- Easements (the right acquired for access to or over another person's property for a specific purpose, such as for a driveway or public utilities. This is referred to as "servitude" in the Province of Quebec) over the property that would be disclosed by a new survey 4- Zoning non-compliance (i.e. where the property use does not meet the local municipal by-laws) 5- Someone other than the home owner having interest (i.e. a previous owner of the property not being discharged from title) Title insurance is generally purchased when you buy your home or when you refinance it, although it can be purchased any time after you buy your home. You will only make one premium payment when you first buy the insurance. A title insurer can tell you how to purchase the policy.
If you purchase land or an interest in land in Ontario you are required to pay the Provincial Land Transfer Tax (PLTT). If you have purchased this land or an interest in land located in Toronto, you are required to pay the Municipal Land Transfer Tax (MLTT) in addition to the PLTT. If you are a first time home buyer you are eligable for rebates for both the Municipal and Provincial Land Transfer Tax: Municipal Land Transfer Tax (MLTT): Maximum $3725 Provincial Land Transfer Tax (PLTT): Maximum $2000 You can calculate the Land Transfer Tax using the following link: www.TOREES.com/Mortgage-Calculator