After saving your hard-earned cash, assessing your options and wondering if the time and market conditions are right, you've finally decided to buy a new home. Now, we all know this can be one of the most stressful times in anyone's life, but how can you make it easier? Of course, the last thing you need is to be making avoidable errors at this point.
So, what mistakes do people make when buying a home? Let’s explore these in more detail:
It's going to be an awful disappointment if you find the perfect home only to discover that there’s no mortgage solution possible for you, even with your deposit. Securing pre-approval will allow you to know what you can afford before you even start looking, enabling you to avoid this kind of heartbreak. It also makes your negotiations much easier as you can demonstrate to the seller that you are a qualified buyer.
However, don’t confuse pre-approval with pre-qualification. The latter will give you an idea of your price range, but it is not as in-depth of a review as the former. If you need more information on how mortgage pre-approvals work, take a look at my blog post on this topic.
Many people think they can save money (and a few extra steps) by not using a real estate agent. However, there are many pitfalls that using a real estate agent would save you from. Real estate agents have a boatload of experience with buying homes that most people just don't have, and you can bet that they’ll help you dart around a few icebergs along your journey toward home ownership. They will be able to suggest:
This may seem like an obvious point, but there are many aspects to it. Hopefully, you're going to spend many years in this area, so you should get to know it inside out. In my experience, many people don't look into this deeply enough, so here are a few pointers:
Of course, these are just a few examples. You will surely have your own personal priorities. Make a list of what you need from your neighbourhood, and then research a little to determine its suitability.
Everyone knows that when they buy a house, they will have to come up with monthly mortgage payments, but there's more to owning a home than that! Unfortunately, many people fail to account for all the expenses and, therefore, may struggle because they took a mortgage that was more than they could afford once other costs were added to their plates. Here are a few other expenses that you should consider:
This list is not exhaustive, and other costs may be specific to the property, such as condo or home association fees. If you need a bit of extra help with this, take a look at my mortgage affordability guide.
The most significant influence on most buyers' decisions when choosing a home is their first impression. However, this can lead you astray! Before you even enter a property, you should make a conscious decision to be as objective as possible. Minimizing bias maximizes focus. Remember that sellers often rely on that first impression to sway potential buyers such as yourself.
That means not falling for the set dressing. For instance, the seller may have just redecorated to cover some otherwise obvious faults. They may have put in expensive decor to give the impression of a luxurious home. Even if you love a house at first sight, ensure that you still get all the proper checks done and that the place ticks all the boxes you need.
On the other hand, a place may look like a total mess and have the most awful decor imaginable, but underneath all that could be some good bones, so to speak. Dig deeper and spend time really getting to know the place. No doubt it’ll look fantastic once your own decorating preferences, mementos, and furnishings have been added.
Understanding the paperwork involved in buying a home is one of the most important things you can do to protect yourself and your investment. Here’s why:
The paperwork involved in this process is complex. You’ll likely be signing contracts, agreements, and disclosures that outline the terms of the sale, your rights and responsibilities as a homeowner, and any conditions or contingencies that need to be met before the sale can be finalized.
This is a fancy way of saying: Once you’ve signed on the dotted line, you agree to the terms of the contract, and it can be difficult or impossible to make changes later on. For example, if you don’t read the fine print and later realize you’re responsible for paying for updates and repairs you didn’t expect, you’ll be on the hook for those costs.
So, how can you ensure you understand all the information in your paperwork? Here are some tips:
This step, while not legally required, is one of the most important in the home-buying process. Some people forgo this in order to save a little extra money. But it may end up costing them more in the long run.
A home inspection is a thorough examination of the physical structure and systems of a home conducted by a professional. During this process, your inspector will look at things like the condition of the roof, foundation, electrical, plumbing, HVAC, and more. They will also point out any potential problems, such as water damage, mould, or pests. Getting a home inspection is crucial for several reasons:
So, how can you ensure you’re getting a proper home inspection? First, ensure you choose a reputable home inspector — as mentioned above, when you work with professionals like real estate agents and mortgage brokers, they likely will have some contacts you can refer to. Here’s what else you should keep in mind:
Buying a new home is a big decision, but that doesn’t mean taking giant, careless leaps toward the big closing date. Make sure you take your time with it and consider the fundamentals in terms of budget, suitability, and lender approval. Your mortgage broker can help with many of these factors. As an experienced mortgage broker, I offer the resources you need for a smooth homebuying process. Get in touch today, and let's chat!
Andrew Thake is a seasoned mortgage broker with over 15 years of industry experience. He’s assisted more than 2,200 clients in finding their ideal mortgage solutions. Recognized for his excellence, Andrew has received high honours and awards, including the National Rookie of the Year from TD Canada Trust and recognition as a Top 10 Ottawa Mortgage Broker in 2023. He has also been inducted into the Hall of Fame at Dominion Lending Centres and has consistently received their Platinum Award during his tenure as a mortgage broker.
Andrew’s dedication lies in serving his clients and prioritizing their needs with an empathetic approach. Throughout the application process, he provides tailored, informed, and efficient services to ensure the best mortgage solutions for his client’s unique circumstances. The best part of Andrew’s job is when he gets to see the joy on his clients’ faces following their mortgage approval.