No matter the size, buying a home is a big expenditure. The down payment, realtor’s fees, property taxes, and mortgage payments are probably in the forefront of your mind as you complete the deal. However, there are many other and less obvious costs that you should be aware of too. Some of these costs are
Investing in stock market it’s no joke. Before you engage in such an adventure, make sure that you are ready for all the challenges you’ll definitely have to face once you begin trading in stocks. When you decide to invest, be aware that it is a process, and not a single event. You will need
If you’re planning to become a homeowner, you must know how much you can afford before you even start looking at properties. Educating yourself about your own financial situation, and your various mortgage options, will help prepare you for your biggest financial investment—buying your own home. Once you are prepared, you will be in a position to start shopping around for your best preapproved mortgage.There are many good mortgage calculators online, but before using these tools you must ensure you have all the necessary financial information. You must know your income and your expenses. Include car payments, utilities, and other debt payments. Realistically, what how much can you afford to spend on mortgage payments per month? How much can you put towards a down payment? Make sure you allow contingency funds, too. Should I rent or buy? The Canadian Association of Accredited Mortgage Professionals (CAAMP) has a useful Rent vs Buy Calculator. This will help you decide if buying your own home is more economical than renting. You will need to know what monthly mortgage payment you can afford before using this tool. Can I afford a mortgage? If you’ve decided to buy a home and know how much you can afford in mortgage payments every month, you could use the Financial Consumer Agency of Canada’s Mortgage Qualifier. This tool will give you a realistic prediction on whether you can afford a mortgage.You will need to know the property value, how much of a down payment you can afford, and your income and expenses. The tool lets you know the total mortgage amount that you can borrow. If your down payment is less than 20 per cent, your maximum allowable amortization period is 25 years. You will also have to purchase mortgage default insurance. The FCAC also has a useful Mortgage Calculator, to help you make a mortgage payment schedule. This tool will help you visualize how much money you can save on the life of your mortgage if you make prepayments. Professional financial advice You should always get financial advice from accredited mortgage professionals when it comes to mortgages. These calculators are self-help tools, designed to help you come to a decision about whether to buy or rent, or what kind of mortgage would be best for you. They are guidelines only. Your next step must be to consult a mortgage broker or financial advisor, who will make calculations based on the lender’s own system. Factors influencing your mortgage In addition to your finances, your credit rating will be taken into account when your mortgage broker or lender is considering offering you a mortgage. A poor credit rating could mean you are offered worse rates, as you are seen as a higher risk. The amount of down payment, too, is a factor.