A Buyer’s Guide: How To Buy A House

Whether you’re a first-time buyer, or you’ve bought before, if you’ve got that twinkle in your eye and you’re starting to think about buying a home, you likely have many questions and may not know where to start.

The good news is that I’m here to help you through every step of the way.

I’ve broken down the process of buying a home, from start to finish, including how I will help you along the way. Remember that every purchase is slightly different, but this will give you a great overview of how to buy a house in Midland and the surrounding areas.

1. Planning

If you’re thinking about buying a home, you’ve likely already given thought to your wishlist. You want to have an idea of:

The type of property you’re looking for;
Your ideal timeline;
Where you would like to buy.

It’s totally OK if you are flexible on any of the wishlist items or don’t have a clear vision, but giving some thought to it is very helpful for the rest of the process. Your wishlist and priorities may change when we start looking at houses, and that’s completely fine.

Here are some things to think about:
  • How many bedrooms and bathrooms do you need?
  • Would you like a garage?
  • Are you willing to do work to improve a home?
  • What kind of yard would you like? How much maintenance are you comfortable with?
  • Do you need to be in a specific school zone?
  • Do you want to live in-town or in the country?
  • Do you need room to grow?
  • Do you require a fast internet connection?

2. Financing

Most people need a mortgage to buy a home. For many buyers, the biggest question they have is how much can I afford?

Getting pre-approved by a lender (bank or mortgage broker) will give you an idea of what your budget will be. During your pre-approval, the lender will review your income and debts as well as your credit score to determine the maximum amount they will lend you for a mortgage and lock-in the best interest rate.

This step is crucial to determine your true budget.

Pre-approval is typically straightforward and painless for most buyers. You should shop around to get the best rate and terms for your mortgage. Make sure your lender does a full pre-approval, not just a pre-qualification. Once you are pre-approved, you’ll also be able to act fast when you find a house you want to buy.

You will likely need to have a downpayment of 5% of the purchase price, as well as proof of an additional 1.5%-2% for “closing costs”.
Bank vs Broker:
A Mortgage Broker has access to many different lenders and mortgage products, as opposed to a bank, which may only offer you a single option. Shop around for the best rate and terms for your mortgage.
If you have a house to sell before you can buy, connect with me first before meeting the lender so that I can give you an idea of how much to expect to get from the sale of your house. This is something your lender is likely to ask.

Don’t make any large purchases on credit after your pre-approval until you’ve officially closed on your house purchase.

If you aren’t sure which lender to use, or you don’t feel ready to do the pre-approval, feel free to connect with me first so that I can point you in the right direction and recommend a lender that is right for you.

3. Connect with a Realtor

It’s around this time that you’ll start to really need my help.

You’ll want to connect with me to get your search started. When I first speak with a new buyer, I always want to make sure to take time to get to know you and how I can help. We will discuss your needs, what to expect during the buying process and what the next steps will be. If you haven’t already connected with a lender, I will recommend a few that will be a good fit for you and your situation.

If you already own a home, it’s at this point that I can give you an idea of its current value and provide you with the steps to get it sold at the same time. If you’re curious about selling your house, check out the “moving” section of my website.

4. Start Shopping

This is where the real fun starts! Together we will start the search by getting out and looking at homes. Most buyers will look online at sites such as Realtor.ca to find listings that might meet your needs.

At the same time, I create a curated list of properties for you to consider using:
  • multiple MLS systems;
  • drive-bys;
  • my Realtor network;
  • websites of listings For Sale by Owner;
  • coming soon listings;
  • phone calls;
  • writing letters;
  • and a variety of other sources.

When I find a listing that fits your criteria, I will send it to you and always make sure to point out the property’s pros, as well as any concerns I may have about it (no house is ever “perfect!).

When we come across one that you are potentially interested in, we will schedule a time to go and take a look. It’s never a waste of time to see a home that you think has potential. I love seeing homes, and even if turns out not to be the one for you, the feedback is very helpful in narrowing down your search.

It usually takes seeing a few homes to give you an idea of the market, but also to narrow down and re-prioritize your wishlist.

5. Make an Offer

Once you’ve found a house you like, it’s time to make an offer. This process is different than it seems on TV and often actually takes a day or two. I will help you through every step of the way, including all the paperwork and negotiations.

The offer is a series of documents that I prepare with you to submit to the Seller and the Seller’s Realtor or representative. The offer lays out all the terms and conditions as well as timelines including:
  • The purchase price
  • The deposit amount
  • The closing day
  • The inclusions (for instance, appliances)
  • The conditions (such as home inspection and financing)

Once your offer is submitted, the Seller responds within a timeframe laid out in the offer and will either:
a) accept the offer
b) sign it back to you with changes to the terms and conditions
c) refuse the offer.

The offer is negotiated back and forth until both the Buyer and Seller agree to the terms and conditions, at which point it is considered accepted. At this time, you will pay the deposit, which is typically held in a trust account and held against your downpayment on closing day.

Most offers, when accepted, are Conditional. Typical Buyer conditions include:
Home Inspection:
This condition gives the Buyer the opportunity to do a home inspection. While there are limitations, having a home inspection will give you peace of mind about the house. I have a list of great trusted inspectors in the area that I can recommend. A home inspection usually takes about 1-3 hours and you, myself, and the home inspector are all present for the inspection.
Although you already have your pre-approval, this condition is for your lender to give approval for the specific property and also to do an appraisal, if necessary.
Your lender will require that you have proof of home insurance at the time of closing in order for them to release the mortgage funds. Basically, you will need to have home insurance in order to get your mortgage. This condition gives you the chance to make sure you won’t have a problem obtaining insurance for the property. Note that just because a house is currently insured doesn’t mean that you can assume that home insurance will be easy to get.
In this area, many homes have septic systems and wells and a condition to ensure the working order of these systems is common. We often request any available documents from the Seller, as well as test the water, and even sometimes have the septic system inspected.

If any concerns come up during the inspections, you may choose to renegotiate some terms with the Seller, or in rare cases, you may decide to walk away from the offer. In almost every case, if a Buyer walks away during the conditional phase of the offer, the deposit is refunded in full.

We usually ask for about 10 days to complete the inspections and financing. Once you as the buyer are satisfied with everything, we can remove the conditions and the offer is considered firm. Time to start packing!

6. Closing Day

This is the day you’ve been waiting for!
The closing day is the day that you actually purchase the house and get the keys.

Once your offer is firm, I send all the documents to your lawyer on your behalf to make the closing arrangements for you. This includes municipal searches, transferring the title to your name, coordinating with your lender for the mortgage documents and much more. Your lawyer is also responsible for distributing all funds for the purchase. Most of this happens behind the scenes, so other than meeting with your lawyer a week or two before closing day to sign the documents, you probably won’t hear from them too much. Nowadays, most everything is signed in advance so you will rarely need to meet with them on closing day.

If you don’t have a lawyer already, I have a list of some great ones who are experienced in this area that I highly recommend.

You can expect to get a call from your lawyer anytime on closing day to let you know that you can pick up the keys. The house is officially yours! This call usually comes after lunch around 3pm but can happen anytime before 5pm.

Between your offer being firm and closing day, we may also revisit the house one or two more times. You can use these visits to measure for furniture, check paint colours, show the house to Mom and Dad, and even more importantly, to make sure everything is as it should be right before closing.

Remember, my role is to help guide you throughout the whole process of buying a home. I am your liaison between everyone involved and I am here to help however I can from start to finish. I can’t wait for the opportunity to help with your purchase!

Real Estate Representitive in Midland, Penetang, Tay and Tiny