How do I buy a house?  Where do we start?

​

Purchasing a house doesn’t have to be complicated.  Your first step is to contact a local, Calgary or Airdrie Mortgage Broker.  As your mortgage broker, I will help your first by determining how much you can qualify for.  Once we determine how much you qualify for, the next step is to check your credit rating to ensure that there are no surprises and make sure you can get a mortgage.  Once we have determined that your credit is good enough to get a mortgage I would submit your application to a lender for a pre-approval.  Now that you have a pre-approval you can begin shopping for your dream house.  I will walk you through the rest of the process so you know exactly what you need to do and when.

​

How much can I spend on a house?

​

When purchasing a house one of the biggest questions, challenges is determining how much you should spend on a house.   Determining how much to spend can be as simple as figuring out how much of a down payment you can come up with.  If you have $20,000 for example, then the most you could spend if you qualify is $400,000.  $20,000 would meet the minimum down payment required if you qualify.  Use a mortgage broker to determine the minimum required down payment, especially seeing the requirement changes when you purchase above $500,000.  You can go to my down payment calculator to find out the minimum down payment required.  If down payment is not an issue, then the next factor to consider is your income to debt servicing ratio.  I will calculate how much you qualify for based on your credit, income and debt payments. After completing this step the next step is to figure out your budget and how much you can afford for your mortgage payments.  

​

What documents do I need to get a mortgage?

​

The lists provided below are just guidelines.  The lenders always seem to find a way to increase the amount of paper needed.  Documents in most cases cannot be more than 30 days old.

Salary / Hourly Employment confirmation

• Letter from your employer confirming position, length and income amount

• If there is any amount owing to revenue Canada, then confirmation the taxes have been paid

• A recent pay-stub

• Last 2 years’ revenue Canada notice of assessments

• If there is any amount owing to revenue Canada, then confirmation the taxes have been paid

​

Self Employed or business for self income confirmation

• Last 3 years’ revenue Canada notice of assessment

• Last 3 years t1 generals

• Confirmation of being self employed for 3 year by providing one of the following;

  • Business license​

  • Articles of incorporation

  • Business GST returns

Confirmation of down payment

• 3 months’ history from any account the down payment will be coming from

• If gifted, then a gift letter would be required

• If RRSP, then 3 months’ history of the RRSP

Existing owned properties

• A recent mortgage balance statement

• A recent property tax bill

• Rental lease agreement if applicable

New Property Purchase

• Offer to purchase for new property

• MLS listing for new property if it is MLS listed

• Condo Documents if Applicable

• For a new build, specs and plans along with Alberta New Home Warranty might be required

For further document requirements, it is always best to consult with a professional to find out.  

​

The Do's and Don'ts to getting a mortgage

​

Don’t move your money around from account to account.  The last thing you want to have to do is provide 3 months bank statements from several different bank accounts to confirm your down payment.  The best thing to do is to leave the money in one place until the down payment is confirmed. 

​

Don’t apply for additional credit.  Once you apply for a mortgage we basically take a snapshot of your financial picture and send it to the lender exactly the way we see it.  Applying for additional credit puts you at risk of lowering your credit score or increasing your debt load so you don’t qualify anymore.

​

Don’t max out the credit you have.  The lender has or will approve your mortgage based on the amount of debt you have at this exact moment so increasing the balances might prevent you from qualifying.

​

Don’t miss any payments on your bills.  Missing even a cell phone payment can alter your credit score enough so you don’t qualify. 

​

Don’t change jobs.  Starting a new job, you usually end up in a probationary position.  You cannot get a mortgage with employment income that is not considered full time.  The lender is relying on your employment income being exactly the way we submitted it so if you change it you may not qualify anymore.

​

Do your research, property, location and so on.  Buying a house is a major decision and one that requires a lot of research.  You want to make sure you are going to be able to live with your decisions as to location, square footage, amenities and so much more.

​

Do contact a mortgage broker for your mortgage.  As your mortgage broker I specialize in the arrangement of residential mortgages.  That is all I do.  Bank reps know bank products so therefore may not be experts in the arrangement of your mortgage.  I will make sure you are getting the right mortgage for your and your family.

​

Do contact a realtor for help finding the right house to purchase.  Realtor’s can save you money.  Hiring a realtor doesn’t cost you money and they will help you negotiate your new home purchase.

​

Don’t skip a home inspection.  Once you have decided to buy it is important to work in to your budget a house inspection.  House inspections can uncover all sorts of issues with a house that you may not be able to find on your own until it is too late.

​

Don’t Overbuy.  It is important for you to make sure you only buy a property that you can afford.  Preparing a budget prior to making your final decision can help you make sure buying in the right price range.

​

Don’t give up, the right house might not be on the market yet.  Keep watching.

​

Do contact your broker before making any major financial decisions.  We can help you decide if now is the right time to make a big change with your finances with respect to your new house purchase.

​

As always… Do contact your Broker (me) for help with your House Purchase!!