1. Before starting to look for a house in Edmonton, decide how much you can afford.
- Reviewing your budget is the first step to look into when setting a date.
- What is the maximum you are able to spend on a home?
- List down the money you receive each month and the money you spend.
- Consider having rent, food, gas and bills in your expenses.
After that, choose the amount of money you can afford to put aside per month. Also, it s a good idea to see what your credit score is. Mortgage lenders tend to offer you better rates if you have a high credit score.
2. Get to Know the Different Mortgage Choices for New Buyers
- To buy a house, you often use a mortgage which is a type of loan. You have to make your monthly payment every month.
- Edmonton offers different types of mortgages.
- Fixed-rate mortgage The rate of interest never changes.
- With a variable-rate mortgage, interest rate can change over time.
- Open mortgage – You are able to pay it off ahead of schedule.
- In closed mortgages, the payments remain the same for the whole loan period.
Contact a mortgage broker who works in Edmonton. They will make certain you get the most favorable offer.
3. Plan to save for a Down Payment
- Alberta requires a down payment for buying a house.
- At the very least, you should spend 5% of the total home price.
- You will need to pay more of a down payment if your house costs $500,000 or above. For example, to buy a $400,000 home, your down payment should be a minimum of $20,000.
- Saving can be accomplished in different ways.
- Contributing toward a TFSA is a good idea.
- Open a special savings account called a First Home Savings Account.
- Take advantage of the RRSP Home Buyers Plan.
Put money aside as soon as you can. Paying a big down payment will result in lower regular costs.
4. Taking advantage of First-Time Home Buyer Programs helps a lot(RRSP and fhsa).
- RRSP
- HBP is the Home Buyers Plan for RRSPs – Get up to $60,000 out of your RRSP.
- You do not have to pay taxes when you take out your RRSP money.
- Arrange to pay back RRSP in 15 years.
- FHSA
- It is possible to save up to $8,000 every year which adds up to $40,000 in total.
- You do not need to pay taxes when making deposits or withdrawals.
- It is possible to save more by using both RRSP and FHSA. They take a lot of the hassle out of getting a home.
- There are also other useful incentives:
- The government provides first-time buyers with help to pay their down payment.
- Claim GST/HST tax money back when you purchase a new home.
5. Consider What Will Happen in the Future
- Do I intend to stay in this city for at least 5 to 10 years?
- Does the place sit near your home or workplace?
- Will there be enough space if I decide to have kids in the home?
- Would I still be able to pay off the loan if interest increased?
Get a home that s suitable for your present and future needs. Think twice before getting a major loan that may bother you in the future.