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Top 5 Things to do Before Getting a Mortgage 

June 7, 2023 | Buying

Top 5 Things to do BEFORE Getting a Mortgage

So you wanna buy a house.

You’ve got it in your sights – the house you want to buy.  It’s beautiful, in a desirable location and all the other boxes are ticked off, including being priced in your budget!

Next step – Mortgage.

It’s a crucial step in home ownership, and it’s also often confusing what you should or shouldn’t do beforehand. To help you out, here are our recommendations for the Top 5 things to do before getting a mortgage.

Trust us, you’ll be mortgage ready in no time!

1. Take Care of Your Credit:

    • In Canada, your credit is super important when getting a mortgage. Make sure to check your credit report for any mistakes and try to improve your credit score as best you can before applying. Pay your bills on time, don’t miss payments and try not to use too much of your credit card limit. (Aim for a max use of 30%!) Having good credit will make it easier to get a mortgage and maybe even get a better interest rate.

2. Get Pre-Approved:

    • Before looking for a home, it’s always a good idea to get pre-approved for a mortgage. This means a bank or lender will check your finances and tell you how much they can lend you. It’s like having a special permission slip to go shopping for a house. Knowing how much you can afford will help you find the right home within your budget and avoid any disappointment.

3. Don’t Forget About Extra Costs:

    • When you buy a house, there are extra costs you need to think about, like legal fees and taxes. These are called closing costs and can range anywhere from 2-5% of the total purchase price depending on a variety of factors. Make sure to save some money for these expenses, so you won’t be surprised later on.  You will thank your self later!

4. Be Careful with Your Spending:

    • When you’re getting a mortgage, it’s really not a good time to buy a lot of new things or take on more debt. Lenders look at your finances and want to make sure you can handle the mortgage payments. So, avoid making big purchases or getting new loans while you’re going through the mortgage process. This means – no designer bags, no pricey vacations and definitely no new cars!  Remember what your mom told you; be careful with your allowance so you can save up for something you really want.

5. Explore Different Mortgage Options:

      • There are different types of mortgages in Canada, and it’s important to know your options. Some mortgages have fixed interest rates, while others have variable rates that can change over time. It’s like choosing between different flavours of ice cream. Take your time to learn about the different types and find the one that works best for you.

Buying a house can be exciting, but it’s also a big responsibility, so be on your best behaviour.

Remember to take care of your credit, get pre-approved, save for closing costs, be careful with your spending, and explore different mortgage options.

Armed with these top 5 things to do before getting a mortgage, you’ll be on your way to owning a home in a flash.

For more information on who, how and what to do before you buy a home, reach out to us today!