Buying a home for the first time can be quite exciting. However, it can also be quite nerve-wracking. There are many requirements and steps involved, and many first time home buyers may be worried that they may make an expensive mistake.

Licensed mortgage brokers can help people navigate the precarious waters of first-time homeownership. Being careful and smart will help first-time homebuyers make common mistakes that can land them in hot water.

You can also use a free mortgage calculator in Mississauga. A mortgage calculator in Mississauga will help you determine if you can realistically afford the home of your dreams. Here, we will provide you with the ultimate guide for first time home buyers.

Is Home Ownership Right For You?

Buying a home for the first time may end up being the most profitable investment you have made up to this point in your life. However, your seemingly smart investment may backfire if you are not emotionally and financially prepared for homeownership.

Before you decide to pursue the home of your dreams, you need to determine if you are ready to tackle the many responsibilities involved in first-time homeownership. First, you will need to determine if you are financially stable. Do you have a well-paying job that you intend to keep for many years to come? Is your spouse or significant other also gainfully employed?

You will also need to perform an honest assessment of your financial management abilities. Are you good with money and resource management? Do you have many outstanding debts that you need to pay off?

Home maintenance is also something that many first time homeowners place on the back burner when it should be at the forefront. If you are not ready to take on home maintenance, renovations, and repairs, perhaps homeownership is not right.

Prepare Your Finances

You will also need to prepare your finances by performing a financial assessment. Your finances will need to be in order before making the call to a lender to obtain a loan. Again, a mortgage calculator in Mississauga can help you determine how much you can realistically afford.

Boosting your credit score may also help increase your chances of qualifying for a loan. There is also the matter of making a down payment. Most homes will require a down payment of at least 20%, so you may need to save up for a few years before contacting your lender.

Paying bills on time will also help you get into the rhythm of making regular monthly mortgage payments and increase your chances of qualifying for a mortgage loan.

Benefits of Working With a Professional Mortgage Broker

Licensed mortgage brokers are highly trained and professional financial experts. The vast majority have a proven track record of successfully processing mortgage transactions. They also have a significant housing industry network that you can take advantage of.

A professional broker will provide you with pertinent industry information that can help you make an informed decision. They will also provide you with access to the best lending rates in the industry to save you money. A licensed mortgage broker will also work with you to customize your loan plan, and they will also save you time and money in the long-term.

Get a Mortgage Pre-Approval

Once your finances are in-check, you will need to determine how much you can afford. You can begin by using a mortgage calculator. A mortgage calculator in Mississauga will factor in the budget you came up with and the total selling price. It will also take into account the amortization/repayment schedule and the down payment amount. 

A mortgage calculator may sound intimidating, but it is as easy to use as a conventional calculator. Simply fill in the required fields, and the software will automatically generate the results for you. However, if you want something more official, please contact a mortgage broker, as they may help you get pre-approved.

Don’t Forget about Homeowners Insurance

Arguably the most important decision that you will make before buying a home for the first time is to obtain the right home insurance for your unique needs. By obtaining first-time homeowners insurance, you will ensure that your home will be covered in the event of elemental damage, vandalism, or theft. Most plans will also provide protection that goes beyond the physical structure of your home.

Contact a reputable insurance agent in your area. They will discuss all of the options at your disposal and will address any questions or concerns that you may have. In the end, they will find the best coverage possible to meet your needs as well as the needs of your loved ones.

Remember the Closing Costs

Many first time homeowners are unaware of the closing costs that are incurred once they have purchased their home. Closing costs tend to be about 3-4% of an average home's purchase price in Canada. Some of the closing costs you will need to prepare for include property taxes, land transfer tax, and title insurance. You will also likely need to pay property survey and appraisal fees as well as home inspection fees.

Closing fees can quickly rack up to several thousand dollars, so you need to prepare beforehand.

Conclusion

Buying a home for the first time can be a very daunting and intimidating purchase, especially during a pandemic. Due to the many risks involved, you will need to prepare for the many expenses that you will need to cover before you buy your first home and future expenses.

Using a mortgage calculator in Mississauga is free. It can help provide you with some preliminary data to determine if homeownership is a realistic prospect for you. 

Working with a licensed mortgage broker will also help increase your chances of obtaining the home of your dreams without breaking the bank.