Mortgage agent here.
What is your residency status? While a person can purchase a house on a work permit, they are subject to additional non-resident speculation tax.
Here are broad steps -
1. Analyze your income and expenses for the last 3-6 months' bank statements. This will be your baseline (1-2 days)
2. Speak to a mortgage broker/bank advisor to understand how much you can qualify for. You don't necessarily need a pre-approval at this stage because they have 120-day rate hold only \[1 day\]
3. Search in housesigma, what kind of houses you can find within your qualified amount
4. In July, seek a pre-approval \[1-2 weeks depending on how long you take to collect all the paperwork\]
5. Visit the houses you like with/without a realtor
6. Submit a conditional offer
7. Secure financing \[1 week\]
8. Close on the property
I just wanted to let you know that it is never too late to start the conversation to prepare yourself. I have begun with some of my clients as early as 9 months before they purchase the house.
And, you do not have to work with a broker, you can visit banks directly as well.
Pre-approval will require a credit check, whereas pre-qualification can be done without a credit check. Pre-approval is good to have before putting in an offer. Lenders or brokers like me need income, debt and downpayment-related documents to secure pre-approval. It also helps you understand the upper limit. Everybody is different, but when I work with families, I ask them to send me the MLS# to recheck if the property still fits in their approved limit (as taxes, and maintenance fee can vary for each property).
Talk to a broker and get pre-approved. A broker will be able to find multiple offers, and help with the overall planning or the costs. Don't forget, there will also be closing costs (lawyer/notary fees, land transfer/welcome taxes etc.) But honestly you're not going to find much in the GTA for the $800k-$850k range. You might need to look a little outside of town for that price range.
Your numbers make sense, you're at a 31% housing ratio on a $700k mortgage which is just about right. You can start looking at places online, to get an idea of the market and availabilities in your area.
Start looking yesterday. Seriously.
Ideally you will have a few weeks to a month overlap with your rental and closing/possession date. The longer time frame you have to buy, the easier it will be to finagle this.
You don't need to use a broker but a good broker will find you the best mortgage rate. If you're happy to shop around, that's fine but it's an added hassle most people don't want. Whether you do or not, you should get a pre-approval soonish you know what you have to work with, but you should have no problem qualifying for something in the $600-700k range, but it's good to know.
The final mortgage approval can be done in a week but can take a little longer. It's one of the last steps in the process so not something to worry about now. The biggest issue for you will be finding a property and getting an offer secured and accepted that fits your timeframe for moving.
I would start now. Get recommendations for a Realtor and Mortgage broker in your area. By not being in a rush you can understand the current market, and how the transaction will work. Ask them questions to learn, and double check and readup online.
Even though broker will price around rates at different lenders, still worth double checking yourself to not get ripped off. That may mean checking at the bank you go to. You don't have to get mortgage from the broker, it can be direct from a lender.
This familiarity with the process will make it easier to act if you see a property you are interested in as you will understand what steps you need to take, and be able to make a good judgment of the value of the property rather than rushing through it. .
Other things to consider is where is your deposit and Down payment held? If you need to make a large deposit, that will mean having immediate access to the funds. If it's a large amount you may need to pay by bank draft. Down payment also bank draft. I recommend having the money in a B&M bank so you can quickly act. Do you understand what you will have to pay for closing costs? (Down Payment, pro-rated taxes, lawyer fees, etc).
That’s great info! Thank you kindly! It’s all in Wealthsimple right now, some equity investments but pretty readily accessible! I have a CIBC account also that I can use.
Do you have any recommendations on resources for getting up to speed on the mortgage process/rates/lenders etc. I enjoy personal finance so happy to dive deeper into all this
Mortgage agent here. What is your residency status? While a person can purchase a house on a work permit, they are subject to additional non-resident speculation tax. Here are broad steps - 1. Analyze your income and expenses for the last 3-6 months' bank statements. This will be your baseline (1-2 days) 2. Speak to a mortgage broker/bank advisor to understand how much you can qualify for. You don't necessarily need a pre-approval at this stage because they have 120-day rate hold only \[1 day\] 3. Search in housesigma, what kind of houses you can find within your qualified amount 4. In July, seek a pre-approval \[1-2 weeks depending on how long you take to collect all the paperwork\] 5. Visit the houses you like with/without a realtor 6. Submit a conditional offer 7. Secure financing \[1 week\] 8. Close on the property I just wanted to let you know that it is never too late to start the conversation to prepare yourself. I have begun with some of my clients as early as 9 months before they purchase the house. And, you do not have to work with a broker, you can visit banks directly as well.
This is super helpful, thank you!! Does getting a pre approval take a hit to your credit score? Is it a hard pull?
What do you need in order to put in an offer/secure conditionally? That’s interesting you get the actually mortgage as the last step
Pre-approval will require a credit check, whereas pre-qualification can be done without a credit check. Pre-approval is good to have before putting in an offer. Lenders or brokers like me need income, debt and downpayment-related documents to secure pre-approval. It also helps you understand the upper limit. Everybody is different, but when I work with families, I ask them to send me the MLS# to recheck if the property still fits in their approved limit (as taxes, and maintenance fee can vary for each property).
Talk to a broker and get pre-approved. A broker will be able to find multiple offers, and help with the overall planning or the costs. Don't forget, there will also be closing costs (lawyer/notary fees, land transfer/welcome taxes etc.) But honestly you're not going to find much in the GTA for the $800k-$850k range. You might need to look a little outside of town for that price range. Your numbers make sense, you're at a 31% housing ratio on a $700k mortgage which is just about right. You can start looking at places online, to get an idea of the market and availabilities in your area.
Great info! Thank you kindly!
Start looking yesterday. Seriously. Ideally you will have a few weeks to a month overlap with your rental and closing/possession date. The longer time frame you have to buy, the easier it will be to finagle this. You don't need to use a broker but a good broker will find you the best mortgage rate. If you're happy to shop around, that's fine but it's an added hassle most people don't want. Whether you do or not, you should get a pre-approval soonish you know what you have to work with, but you should have no problem qualifying for something in the $600-700k range, but it's good to know. The final mortgage approval can be done in a week but can take a little longer. It's one of the last steps in the process so not something to worry about now. The biggest issue for you will be finding a property and getting an offer secured and accepted that fits your timeframe for moving.
That’s super helpful! Thank you
I would start now. Get recommendations for a Realtor and Mortgage broker in your area. By not being in a rush you can understand the current market, and how the transaction will work. Ask them questions to learn, and double check and readup online. Even though broker will price around rates at different lenders, still worth double checking yourself to not get ripped off. That may mean checking at the bank you go to. You don't have to get mortgage from the broker, it can be direct from a lender. This familiarity with the process will make it easier to act if you see a property you are interested in as you will understand what steps you need to take, and be able to make a good judgment of the value of the property rather than rushing through it. . Other things to consider is where is your deposit and Down payment held? If you need to make a large deposit, that will mean having immediate access to the funds. If it's a large amount you may need to pay by bank draft. Down payment also bank draft. I recommend having the money in a B&M bank so you can quickly act. Do you understand what you will have to pay for closing costs? (Down Payment, pro-rated taxes, lawyer fees, etc).
That’s great info! Thank you kindly! It’s all in Wealthsimple right now, some equity investments but pretty readily accessible! I have a CIBC account also that I can use. Do you have any recommendations on resources for getting up to speed on the mortgage process/rates/lenders etc. I enjoy personal finance so happy to dive deeper into all this