What first-time buyers can learn from homeowners’ hindsight
Things they wish they’d known before buying
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Shoulda, woulda, coulda. If you’ve managed to make it through life with no regrets, you’re definitely in the minority.
Even Frank Sinatra, who famously crooned I Did It My Way, had a few. But since buying a home is probably one of the biggest-ticket purchases you will ever make in your life, we asked recent homebuyers to share with us some of the things they wish they’d known about the process.
1. Get your ducks in a row well in advance when it comes to financing. Chris Ryall lost the house of his dreams because “the bank wasn’t able to get their act together in time.” Ryall had already owned and paid off two houses, but after his divorce, he and his girlfriend wanted to buy a house together.
“I figured getting financing would just be a formality,” he says. Ryall reasoned that he owns a business, has a credit score in the top five per cent, and has been with the same bank for many years. But he couldn’t have been more wrong. “None of that meant diddly-squat,” he says.
2. Do a credit check in advance. “Credit scoring agencies like Equifax and TransUnion can make mistakes,” says Ryall. His girlfriend’s credit score still reflected an old loan she had repaid long ago. And, as Ryall points out, every time some company does a credit check on you — for instance, when you’re changing cell phone plans or if you move and have to set up services in the new location — it can negatively impact your credit score.
3. Opting for a condo? Read the rules and regs thoroughly.“I was surprised at some of the fees implemented by my condo board,” says personal finance blogger Barry Choi (moneywehave.com), who bought a condo last year with his wife Carla Salvosa.
“If we ever get locked out of our unit, we’ll be charged to have the concierge let us back in,” he says. “We’ll also be charged if we leave our car in its parking spot when they’re power washing the garages.” Although Choi and his wife haven’t yet been dinged for anything, he says, “some of the fees listed still seem insane to me.”
4. Buying a new home? Think long term and upgrade the materials. “We bought our house brand new from a builder,” says Nancy Truman of Markham, Ont. I wish we had known to upgrade the materials used at the time.”
Just 12 years on, Truman has already replaced the roof and the attic insulation. In addition, she says “the windows ice up and the garage door keeps falling apart.”
5. Give yourself time to get out of one home and into another. Dan and Jasmine Young moved into their Toronto home in December. “We closed on our new house and old house on the same day,” he says. “That meant we had to be out of one house and coordinate getting into the other all on the same day. It added a ton of stress on top of having a pregnant wife in her third trimester!”
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It comes down to math: The first step is to add your net incomes together. Then divide each individual income by this figure and multiply by 100.
So many people see the math of money as overwhelming. It isn’t. It’s Grade 5 math. Stop using this excuse!