Step 1. Preliminary Qualification
Selecting your Vancouver Mortgage Specialist
Once you have your desired down payment, its time to secure a mortgage for the difference of the purchase price. When you are looking to secure a mortgage, just like with searching for a realtor you need more than one opinion. Of course it is advised to save the largest down payment possible. Depending on the size of purchase you are interested in, you may or may not have the 20% threshold met. If you are under the 20% deposit threshold you will require mortgage insurance.
When searching for your financing, you will come across two different types of agent. A Mortgage Specialist or a Mortgage Broker. A Mortgage Specialist is one who works specifically for a bank and only represents the financing options of said bank. A Mortgage Broker is one who has a variety of lenders at their disposal. They can give you many more financing options from many more sources. Everyone has their preference but we suggest speaking to at least one of each to get the best options possible.
If you are not already friendly with a Mortgage Specialist or Mortgage Broker, we are here to help. We have long standing working relationships with a variety of Mortgage Brokers & a number of specialists from the big banks.
If doing your own research, here are some places you can search for details about Vancouver Mortgage Specialists / Mortgage Brokers you are interviewing for the job: friend Or family member, google, google reviews, yelp reviews, facebook, instagram, youtube. But we believe a worm referral is always best!
Selecting Your Vancouver Real Estate Agent
We always suggest speaking with more than one Real Estate Agent! Most of us know someone, a few people or someone who’s friends with a Real Estate Agent here in Vancouver. When you are looking to purchase your first home, you need to know you are in the right hands regarding your Real Estate representation. How do you do this? Interview multiple people until you get a secure feeling of trust, integrity & experience. Investigate their digital presence & track record, look for testimonials or reviews to get an idea of others experiences with different agents.
Here are some places you can search for details about Vancouver Real Estate Agents you are interviewing for the job: ratemyagent.com, google, google reviews, yelp reviews, facebook, instagram & youtube.
Weather you are working with your aunt who is a licensed Real Estate Agent or you have interviewed a few and selected your neighbourhood specialist. Here are a couple of questions we suggest asking one or all Realtors you are interviewing:
- How long have you been in the business?
- Have you worked with or do you commonly worked with First Time Home Buyers?
- What is your step-by-step Buying process for us?
- Do you have a network of professionals that we can tap into throughout our buying process?
- How familiar are you with the areas / products that we are looking at purchasing?
- Any other questions you have ever wondered about the Vancouver Real Estate Market or the Home Buying process. There is no such thing as a stupid question!
Once you are in the right hands & the Realtor of your choice has outlined the process for you by answered all of your questions you can then let the fun begin!
Exclusive Buyers Agency agreement:
Is your Real Estate professional requested or making it a stipulation that you sign this document before working together? This is normal. This is essentially the same thing as a Listing Contract if you were selling Real Estate, but of course the exact opposite. Every Realtor is different and some will highlight this as more important than others. It is not mandatory, but it is normal.
Step 2. Reviewing Purchasing Costs
P.T.T (Property Transfer tax):
This is an applicable tax on all purchases of Real Estate. The tax is applicable on any purchase if you are not a first time home buyer. If you are a first time home buyer, you are exempt from P.T.T on purchases under $500,000, with a sliding scale exemption between the prices of $500,000 - $525.00. There is no exemption of first time home buyers after a purchase price of $525,000.
The P.T.T is charged at the following rate:
1% on the 1st$200,000
2% on $200,001 to $2,000,000.
3% on $2,000,001 +
Goods & Services Tax (5%) is only applicable on brand new homes or substantially renovated homes.
The home inspection is done at a cost born by the Buyer in the transaction. It is depending on the size of the home, but the inspections will range roughly around $600 per inspection report completed. Home inspections roughly take 1.5 – 3hrs to complete. We have a selection of professional home inspectors that we have been working with for a number of years. We always recommend that you accompany the Home Inspector during your home inspection in order to ask any and all questions you may have throughout the process.
Legal fees (Notary / Lawyer):
The conveyancing of a Real Estate transaction is done by either a Lawyer or Notary Public. The price ranges between $850 - $1,500 depending on your selection of Notary or Lawyer. At this meeting roughly 7 – 14 days prior to the completion of your real estate purchase you will go through a document called “The statement of adjustments”. This document will highlight all applicable costs involved in the sale, in detail. We have both Lawyers & Notary Publics that we have been working with for years that are fast & confident that we would be happy to share with you during the final steps of your transaction.
Deposit (usually a minimum of 5% of the purchase price of the property):
Your purchase deposit is held safely & securely in that Trust account at “Oakwyn Realty Downtown Ltd In Trust”. The deposit is transferred into trust by way of delivering your Real Estate Agent a Bank Draft / Bank Wire in the applicable amount noted on the contract of purchase & sale. Once all subjects are removed from your offer of purchase and sale and you are 100% satisfied with the terms of the contract to purchase the property, your deposit will go into trust.
Secondary purchasing costs:
Mortgage Related Costs
- High Ratio Mortgage Insurance (borrowing over 80%) 1% - 4%
- Appraisal Fee (average $350) – banks decision
- Survey / certificate of location (houses only)
Strata Fee Adjustment
Property Tax Adjustment
Home & Content Insurance
Moving & utility connection Fees
Step 3. First Time Home Buyer Rebates & Savings
Property Transfer Tax Rebate (Citizen/permanent resident – 12mo in bc or 2 tax returns in 6yrs):
*Previously Lived In - First Time Home Buyers may be exempt from paying Property Transfer Tax (P.T.T) of the purchase price of a home priced up to $500,000. There is a proportional exemption for $500,000 to $525,000.
*NEW CONSTRUCTION – full exemption if under $750,000 & proportional exemption for $750,000 - $800,000.
Registered Retirement Savings Plan (R.R.S.P) Tax free withdraw:
C.R.A. lets qualified home buyers us up to $25,000 of their R.R.S.P’s to buy a home. Couples can use up to $50,000. The home must be the principal residence, the home buyers must not have owned a home within the past five years and the loan must be repaid within 15yrs.
G.S.T. Rebate on new home:
New home buyers can apply for a rebate of the 5% GST if the purchase price is $350,000 or less. The rebate is up to 36% of the 5% GST to a maximum rebate of $6,300. There is a proportional GST rebate for new homes costing between $350,000 and $450,000.
Step 4. The Search & Completion
Property Search & Selection:
Define your criteria
Become an expert
Contract negotiation & transaction management:
Making an offer
Once offer is accepted
Selecting a notary public / lawyer
Prepare for the move