When you decide to buy property, a home, or a condominium in St John or anywhere else, there are five things that you need to consider and be aware of.
Know Your Credit Rating
Your credit rating is a record of your credit history and your current financial standing. Your lenders will use your rating to check your repayment history on previous loans and credit card bills.
It is important to know your rating, because having a good rating will increase your odds of getting a home loan or mortgage. The best way to improve bad credit is to always meet the minimum payments on credit cards, utility bills, or other loans before the due dates. If you are not aware of your credit rating, you can pay a small fee to check the rating on one of many online credit rating services.
Be Realistic About Your Budget
One of the most important things to remember when buying a new or second home is to keep your budget realistic. You should make use of an online mortgage calculator with the ability to determine how much you can afford. This type of online service will allow you to enter your income and expenses, as well as several other types of information, to determine the maximum mortgage repayment amount that you can afford monthly.
By using a service like this, you can easily figure out how large a loan you can realistically apply for. Alternatively, you can consult your bank’s loan officer for a detailed personal review.
Consider Pre-Approved Mortgages
When you take the time to find out the maximum mortgage amount that you can be automatically approved for, it allows you to determine a solid price range. The main factors to consider when determining your pre-approval level are:
- Level of household income
- Credit rating and repayment history
- Any previous debts and repayment history
Know Your Down Payment Options
Depending on your budget, there are several different options for down payments. While the rates can vary from bank to bank, the typical down payments are as follows.
- Conventional mortgages need a down payment of 25%
- High-ratio mortgages need a down payment of 5%
Consider Non-Banking Expenses
The most important things to consider when you are buying a new home are the non-banking expenses. We will discuss these in depth in a future article, but you need to remember these fees:
- Attorney’s fees
- Home inspection
- Property tax
- Property Insurance
- Property value
- Moving expenses
Buying a home in St John can be exciting and overwhelming. By considering these five things, you can make the process much less stressful.