liquidsuite

Hi how are you all. I am a totally newbie on information regarding house buying etc. I am thinking of buying a house. But want to know how much I will need to make this happen. I am planning on borrowing a large part of my down payment money so would like to know how much I should borrow accoring to how much house is worth.

I have seen some house in my area which are around $375-400k So trying to work out how much I will need and what other additional fees will there be. Its so scary to think about buying house as I do not know to much about it all. Any advice for me would be great help.

Also should I hire a specialist like a mortgage broker or real estate person who is the right person to help and do they charge a lot?

So many questions hope you guys can help me out with some advice. Thanks in advance.

justkidding

I would start with your bank. Just make an appointment with a mortgage specialist and they will go through everything with you. How much you will qualify for and how much down payment you will need to have. There would be no obligation to use them and no charge to you.

Mortgage Brokers get paid by the lenders and Real Estate agents get commission from the sellers.

JonboyE

Lots of good information here ... http://britishexpats.com/wiki/Category:Housing-Canada

You will need a minimum of 5% down payment - $20,000 on a $400,000 house. Generally you cannot use borrowed money for the down payment.

The first thing is to talk to your bank and see if they can pre approve you for a mortgage. It is also worth talking to a mortgage broker as they may have access to other lenders. Discuss their fees. In most cases they get their fees from the lender.

Although some on this board disagree, I strongly recommend that you hire a real-estate agent once you know your budget. The system is very different in Canada and unless you are very confident about what you are doing you could easily get yourself into a right mess. There is no cost to you as your agent gets paid from the seller's commission.

Novocastrian

As others have said, you can't borrow the down payment. The absolute minimum is 5%. You need to do some more research, but it's not hard. I bought my first house here with the minimum down (and a first and second mortgage), sold it 1 year later for a net 500% gain on the down.

Best of luck.

HGerchikov

This is correct for the most part about the real estate agents fees. However, due to the increase in private sales that are listed on MLS but do not pay buyers broker commissions some realtors are asking clients to fill out a buyers representation agreement that specifies a minimum commission payable to the agent. if you choose to buy a house where the seller does not pay the commission then you would be expected to pay. You should be aware of this though before you put in an offer. Just make sure you fully understand what you are signing. For the most part though it is absolutely worth it to you to use a buyers agent, they can show you round, find comparable sales in the neighbourhood to help you decide how much to offer and then negotiate the deal, and as said above in most cases this comes with no additional cost to you.

Howefamily

Can I also add that once you sign offer paperwork that is then accepted you cant get out of the contract unless the conditions are not met, usually these are that the house has to pass the home inspection and the buyers financing comes through, and the lawyers have to agree the sale (these are laymans terms of course re the lawyer part), although all sorts of conditions can be added to the offer.

You cant make those conditions above not be met, you are contracted to buy. This is where it is different to the UK, where you can change your mind once your offer is accepted.

Be sure you want to buy the house that you are interested in, before you go down this road. Changing your mind, in my experience, is not a reason to be able to back out of a contract.

dbd33

Note that the lawyers don't actually do anything for the parties they nominally represent. They don't, for example, review the contracts and they don't assume any responsibility for the content of the contracts. They arrange title insurance to cover the possibility that the property isn't as specified, for example, the wrong size or location of lot being shown.

conjonway

And in order for you to get an idea on how much your mortgage is going to cost you then take a look at one (or both of these sites) for what the current best mortgage rates are:

http://ratesupermarket.ca
http://ratehub.ca

Those sites give you rates through a broker, and at no charge to you. But if you do find your own broker make sure that they can at least match the rates that you find yourself. Through my experience last year with a mortgage broker, he did not find me the best rate, I found it on RateSupermarket, took it to him and told him to match it.

liquidsuite

Hi thanks for replys an advice. I have been sent a form to fill by the mortgage specialist. One question they ask is where downpayment is coming from. I am borrowing from family members on no interest rate half and other half I am paying. I do not want them to look at it negatively. Can u let me know is it ok or not to put that.

Almost Canadian

No you can't. Once the contract becomes legally binding, the remedies for breach of the contract are virtually indentical either side of the Atlantic. In both situations the contract is formed when contracts are signed. Anything done prior to that is simply a discussion.

Howefamily

what I meant is that in England, when you put in an offer, its just an offer until exchange, you can walk away at any point without explanation if you wish. Here your offer is full of paperwork and its legally binding once its accepted unless the conditions are not met, therein lies the difference. An offer here is so different to an offer there

wolstie

I can't see it being a problem.

If you have less than 20% downpayment, your mortgage must be insured. There are only two companies that can insure your mortgage, CMHC and Genworth.

Here's CMHC's General Requirements: http://www.cmhc-schl.gc.ca/en/co/moloin/moloin_003.cfm

Here's Genworths: http://www.genworth.ca/homeownership...quirements.asp

FWIW, if you're a temporary resident you can't use borrowed funds, but you can when you're a PR. Just been through all this with various mortgage brokers recently.

R I C H

Insert the word 'acceptable' in front of financing, and the buyer's pretty much got any reason they like to withdraw from the purchase process.

Almost Canadian

That sounds like estate agents' speak to me. They are both binding when they become binding, not before. Just because, generally, in the UK your estate agent will advise you to take your property off the market once a verbal offer is received, it doesn't mean that the offer is anything more than a discussion. In fact, one cannot "accept" an offer in England and Wales unless the offer is in the form of a written contract, just like in the vast majority of Canada.

Aviator

Most lenders (if not all) will not allow you to 'borrow' the down payment, you either have to have it outright or have gift letter from the donor saying it is a gift and never has to be repaid. This is part of the contract with the mortgage lender.