Buying your first home is an exciting time. The world is your oyster. You actually get to look at all those houses you dream about with the intention of actually living in one in the very near future. Before you can go from nice house on the real estate listings to actually living in your new home, you have to take out a mortgage to you can afford the purchase price. This is perhaps the most confusing and difficult step, so we will endeavor to guide you through the process.
Before you start visiting mortgage brokers or lenders, you need to sit down and figure out, realistically, how much you can afford. The temptation is for first timers to take out a mortgage in Mississauga, Canada that they can't afford because they want their dream house right away, but remember: your first home is a stepping stone, not an end game. To remain financially solvent, aim to have a 20% down payment and monthly payments that don't exceed 30% of your income.
There are dozens upon dozens of different mortgages in Toronto available from a variety of different lenders and institutions. Therefore you shouldn't just take the first one that is offered to you. You should gather as much information as you can. Visit all of the banks and speak to a mortgage advisor. Find out what they're willing to offer you. Even if it sounds like a good deal, don't say yes right away. Always take time to think.
During your thinking time, you should compare all the mortgages that are available to see which one is the best deal for you. A difference of even half a percentage point the interest rate of your first mortgage in Canada is a difference of thousands of dollars overall. Don't forget to look at the lengths of the mortgages as well as monthly payments, because the longer you're paying the more you're losing to interest.
Some sellers are leery of first time buyers who want to make their offer conditional on getting approved for a mortgage, because there's no guarantee you will be approved. So you may find your real estate agent telling you that you lost out to another buyer with a lesser offer because they could pay right away. To keep this from happening, apply for mortgage pre-approval before you go looking at homes.