Our blog

Finding the perfect place to call home and settling in can be fun!

Buying your first home is a really big step. And it’s probably going to be the biggest purchase you ever make. While looking for a home is exciting, in this tight real estate market, it’s important to know what kind of mortgage you qualify for before you start the hunt. If you fall in love with a house, chances are someone else has, too. If you aren’t pre-approved for a mortgage, you could lose your dream home to someone who already is.

Understanding the financial side of getting a mortgage can be overwhelming and daunting. There are a lot of things that need to be figured out: how much you qualify for, interest rates, mortgage term (15 years, 20 years, 25 years), payment plans (weekly, bi-weekly, monthly), whether you want a variable or fixed mortgage, and the list goes on.

It can be hard for first-time home buyers to know where to start. After all, a lot of different factors go into determining what kind of mortgage you qualify for. It depends on your income, debt, and credit history. By shopping around and asking questions, you could end up saving yourself tens of thousands of dollars over the term of your mortgage.

Do you go to a bank to get your mortgage? If you do, are you getting the best interest rate? Are the terms and conditions best suited to your economic situation and lifestyle? Or are the banks just going to push their own products and services?

Better yet, do you use a mortgage brokerage like Canadalend.com, whose independent, licensed agents draw from all available mortgage products and provide you with impartial advice?

For the most part, all first-time home buyers want the same things—to maximize what they can borrow, to minimize their interest charges, and to pay off their mortgage as quickly as possible. When it comes to getting your first mortgage, the real difference comes in service and communication.

If you want to find out what kind of house you can afford; compare mortgage terms, rates, and amounts; or figure out how to save thousands by increasing your monthly mortgage payment, try Canadalend.com’s wide variety of interactive financial calculators.

Canadalend.com’s professional agents love working with first-time home buyers, helping them get the mortgage best suited to meet their financial needs and getting them into their dream home.

Canadalend.com’s licensed agents make it easy for first-time buyers to choose the right mortgage. Whether you need a big or small, fixed or variable mortgage, Canadalend.com agents work with all the major banks and lending institutions to get you approved in 24 hours.

A Canadalend.com agent is more than just the perfect resource for first-time buyers looking to get an approved mortgage fast! Your Canadalend.com agent can continue to be a great support, helping answer your questions and providing you with advice or referrals. At Canadalend.com, our goal is to help you achieve your short- and long-term financial goals.

What should first-time buyers look for when it comes to getting a mortgage? The nearest independent, licensed Canadalend.com agent!

Taking out your first mortgage presents a major financial commitment, possibly the biggest one you'll ever make, so it's crucial that you get the best deal available. Getting a mortgage is often not a quick and straightforward process either, particularly since the options available to you will vary depending on factors such as your income, credit score and any past or current borrowings you might have.

#1. Save Up a Large Deposit

In almost all cases, you'll need to have a substantial deposit to pay towards the home you want to buy. Fortunately, those with higher deposits will be able to take advantage of better interest rates and a wider range of borrowing options.

#2. Choose the Right Mortgage Type

There is a broad range of mortgage options available, particularly to those with larger deposits and excellent credit ratings. Most importantly, you'll be choosing between a fixed- and variable-rate package. Fixed-rate mortgages lock you into a specific interest rate for a period of up to five years, making them the best choice during periods of low interest rates across the board.

#3. Understand the Extra Costs

When determining how much you need to borrow, you'll need to factor in the additional costs involved, most of which are unavoidable. Additional costs may include home inspections and real estate fees.

#4. Don't Borrow Too Much

It can make sense to borrow as much as you can if interest rates are at an all-time low, but only if you have something to invest the money in. After all, there's no point in having your borrowed money sitting in the bank while you're paying interest on it. If the home you're interested in buying needs a substantial amount of work done on it, make sure you get some estimates to find out how much you need to borrow.

#5. Check Your Credit Score

Your credit score determines your borrowing power, and this is one of the first things that potential lenders will examine when considering your application. You can check your credit score online for free using agencies like Equifax or Experian. If you have a bad or neutral credit score, your borrowing options will be fewer or even none at all, so it makes sense to work on improving it before buying a home.

#6. Don't Change Jobs

Potential lenders are likely to be turned off by applicants who have recently changed jobs, so it's wise to apply for a mortgage only once you've been in the same job for at least six months. If you're unemployed or still on a probationary period in your job, many lenders will not accept your application unless you have an excellent financial record. Once you have your application accepted, you're free to do what you want.

#7. Eliminate Debts

If you have any existing debts, they may reflect badly on your credit score, in turn making it more difficult to get a good mortgage deal. You may also find yourself in a situation later where your debts have reached such a level that you can no longer afford your monthly mortgage payments. As such, you should always make certain your financial situation is stable and debt-free before making an application.

#8. Provide Proof of Income

All mortgage lenders require applicants to present proof of income so they can decide whether or not the client is able to make the monthly payments. Your monthly pay stubs should provide all of the information you need. If you're self-employed, things can get more complicated, particularly if you haven't been self-employed for a long time.

#9. Overpay When Possible

When choosing a mortgage deal, it is essential not only that you can afford the monthly payments, but also that you will have plenty left over. Since a mortgage is typically a very long-term commitment, you should try to overpay as much as comfortably possible, in order to eliminate the debt earlier on. Paying your mortgage off sooner will look better on your credit score and improve your long-term finances.

#10. Contact a Mortgage Broker

A Mortgage Broker's primary expertise is locating funding for mortgage financing. They know where the best rates can be found. What's more, they have the knowledge required to present a proposal for financing to lenders in the best way possible to successfully obtain mortgage financing.

Final Words

Although you should dedicate plenty of time to researching the best deal, it is important to remember that you're not locked in for the entire duration of the mortgage. You can always remortgage your home later on with a more attractive deal should the opportunity arise. There will be charges involved in transferring your mortgage debt, but the long-term savings can be substantial.