Blog

Is It A Good Time To Consider Buying Your First Home?

By Debt.ca on June 29, 2014 No Comments

You’ve been house hunting for months when you suddenly come across your dream home: a three-bedroom bungalow with a garage and a walkout patio. If you’ve only managed to scrape together the minimum five per cent down payment, you may be wondering if you should purchase now or wait until later. Purchasing a home will be the single largest financial transaction of your lifetime, so it’s important to make the decision carefully. Here are some things to consider before making an offer.

High-Interest Debt

If you have high-interest debt you might think twice about purchasing a house. If you’re carrying a balance on your credit card, you should concentrate on paying it off before you consider homeownership. When you’re a homeowner you won’t have a choice when it comes to paying your mortgage – if you don’t pay your mortgage the bank will foreclose on your home, so it should be your top priority.

Low Mortgage Rates

Mortgage rates are currently at historic lows. Right now you can get a 5-year fixed rate mortgage at less than three per cent and a variable rate mortgage even lower – at 2.6 per cent or lower. This makes it a great time to take out a mortgage.

It is a good idea to take advantage of low mortgage rates and pay down your mortgage as quickly as possible. Interest rates won’t be low forever – chances are they’ll be a lot higher when you renew your mortgage. Often there’s no better investment than your home.

Seller’s Market

Many mortgage markets across Canada are considered seller’s market – that means sellers are able to call the shots. In red-hot housing markets like Toronto and Vancouver, bidding wars are commonplace. If you’re going to have to pay an arm and a leg for your dream home, you might think twice about buying now. On the other hand, if home prices keep rising you could find yourself priced out of the market next year. If you’re willing to purchase in an up-and-coming neighbourhood you can avoid a bidding war and get your dream home today.

Stricter Mortgage Rules

Although mortgage rates may be low, it’s more difficult than ever to qualify for a mortgage. The federal government introduced in recent years four sets of stricter mortgage rules designed to avoid a major housing correction. One of the biggest chances is that the maximum mortgage amortization has been trimmed from 40 years to only 25 years on high-ratio mortgages – that means the carrying costs of a home have significantly increased. Before buying, it’s a good idea to draw up a budget ahead of time to see if you can still afford a home with the highly monthly mortgage payments.

A Home is a Good Long-Term Investment

Over the long haul a home is a good long-term investment. Not only is it a roof over your head, you can rent it out to increase your income and pay down your mortgage even sooner. By paying down your mortgage you’ll build up equity in your home and help boost your net worth.

Debt.ca

Admin


Which Type of Debt Should You Repay First?

By Amanda Reaume on March 23, 2017

Some people feel very anxious when they’re in debt and want to pay it off as soon as possible. But if you have a lot of debt or if you have many different types of debt, then you might be confused as to which debt you should pay off first. The first thing that you…

Having the Money Talk with Your Romantic Partner

By Rubina Ahmed-Haq on March 16, 2017

Money is one of the major reasons couples fight.  A study out of Utah State University found that couples who fight frequently about money are more likely to get divorced. That’s compared to any other issue they might fight about, child rearing, their love life and household chores (as an example.) Before your relationship moves to…

How to Save on Heating Costs, Even as a Renter

By Jordann Brown on March 9, 2017

One of the best ways to free up room in your budget to pay down debt is to trim your expenses. There are plenty of ways to trim your budget, but one often overlooked method is to reduce your utility costs. Home heating makes up 42% of your home’s overall energy use, and drain your…

5 Tax Breaks You May Not Know About

By Alyssa Davies on March 2, 2017

We’re getting closer to the time of year when the Canada Revenue Agency awaits your annual income reports. From there, they will determine whether or not you are income tax receivable or income tax payable. What’s the difference, you ask? Income tax payable means that you must pay the government within one year, and income…

No Comments Leave a Comment  

Leave a Comment

Free Savings Estimate

How much do you owe?

$100,000

$5,000
$100,000
Live Chat
Welcome to our Live Chat
Agents are not available at this time. Please leave a message. Thank you.
First Name
Last Name
Phone
Email
Postal Code
Debt Amount
 
PHP Live! powered