7 Ways to Have a Stress-Free Home Buying Experience
Buying a home can be a little scary, especially when you think about spending more than double your yearly salary in one fell swoop.
But it doesn’t have to be. Unless you’ve started taking yoga classes to get into your “zen zone,” here are 5 well-known, and 2 surprising ways to have a stress-free home buying experience.
1. SAVE FOR YOUR DOWN-PAYMENT USING THIS UNIQUE METHOD
You know you need a down payment before buying a house, but it can be difficult to save. So here’s a cool way to do it.
If you know more or less what your monthly mortgage payments will be (you should get pre-qualified – see below) – and more often than not it will be more than your monthly rent – you can start saving the difference between your current rent and what your future mortgage will be.
Say your rent is $1000/mo, and your mortgage will be $1,500. If you save $500/mo, at the end of 6 months you’ll have $3,000 put away, AND you’ll be used to paying your monthly mortgage amount! You’re hitting two birds with one stone.
2. LOOK INTO PROGRAMS FOR FIRST–TIME BUYERS
First time home buyer? You’re in luck! The Canadian Federal Government has several programs designed to help newbies buy their first home.
Here are just a few:
- The First Time Home Buyers’ Tax Credit (HBTC): http://www.budget.gc.ca/2009/plan/bpa5a-eng.html#3
- The Home Buyer’s Plan: http://www.cra-arc.gc.ca/hbp/
- The GST/HST New Housing Rebate: http://www.cra-arc.gc.ca/E/pub/gp/rc4028/rc4028-e.html
- Now if only there were a time-machine so I can go back in time to buy my first home.
- Non-profit Home Ownership programs like www.libertyhomeownership.org that can get you into a home for only $1,500 downpayment.
3. CHECK YOUR CREDIT REPORT
If you’ve been racking up the debt and buying everything with a credit card, you might be in for a not so pleasant surprise when you apply for a mortgage.
Both Equifax and TransUnion keep credit scores for Canadians (you can find info on these services here: https://www.ic.gc.ca/eic/site/oca-bc.nsf/eng/ca02179.html). Both agencies offer free credit reports. Make sure you check your credit report before you start your home search – and if your credit is not where you want it, start getting it in line now!
4. GET PRE-QUALIFIED FOR YOUR MORTGAGE
Getting pre-qualified is like getting a home-buying credit card. You’ll know what your credit limit is, how much home you can afford, and what our monthly payments will be. And guess what? This can give you a leg up on other buyers who you might be up against you in a competitive bidding situation.
When getting pre-qualified you may be required to provide documentation to show proof of income, employment, rental history, and other important factors. Start gathering these documents as soon as possible.
5. TAKE A HOMEBUYER COURSE
One of the best ways to take the stress away is to take a home buying course. You’ll come out of there feeling almost guilty because you’ll have the “insider knowledge” most other homebuyers won’t have.
Plus you you’ll be in a better negotiating position when talking to the home buyer! There’s nothing like knowledge to give you that edge.
6. WHAT TO LOOK FOR IN A NEIGHBORHOOD
Most young families look first at the school district before deciding what neighborhood to move into. But there are a few other neighborhood considerations you should look at before making a decision you might regret later.
Proximity to a hospital.
Even if you don’t have health issues, this one can come in quite handy. And I don’t want to say “you never know,” but you never know when you might need one.
Activities and amenities.
Quality of life for a family with young children or a single bachelor, depends a lot on the local amenities available where you plan to live. Families with children might be interested in swim/tennis communities with parks, as well as libraries and ballet and karate lessons nearby. A young single person with a dog might want a dog park or bike trails within walking distance, plus an active nightlife scene with bars or restaurants close by.
How convenient your neighborhood can affect your happiness as well as your wallet. Is there a shopping center nearby where you can accomplish several errands at once — pick up your groceries, fill a prescription, grab a bottle of wine? Easy access to the stores you frequent is key to keeping your stress level to a minimum, and can help you avoid spending too much money on gas, not to mention your commute to work.
7. HACK YOUR HOME BUYING
But what does this even mean?
If you’re looking for your first investment property, you can use the rent from the other units to pay your own living expenses, why not buy a condo in one area and rent it out while you rent a place near your work? You get the best of both worlds, plus you own your first home!
Home buying doesn’t have to be scary, depressing or stressful. It can be seamless, even fun (yes, I promise it can be fun). But first you have to prepare in advance so you know what you’re doing from the beginning.
And if this list doesn’t help you, go take a yoga class and do a couple of downward dogs or three. You’ll be stress-free in no time.