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So what are some of the advantages of becoming a homeowner today?

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So what are some of the advantages of becoming a homeowner today?
So what are some of the advantages of becoming a homeowner today?
  • Home ownership is the single largest source of savings for Canadian households.
  • Your payments build equity (as opposed to renting, where your money goes to the building owner).
  • Unlike other investments that can be volatile, typically when you buy a home the increase in its value has proven to be relatively steady over time.
  • Homeowners can use the equity in their homes as security for other loans once a certain percentage of equity has been established.
  • Buying a home and building equity is the first step on the property ladder. It gets you into the housing market, keeps you in touch with increasing house prices, and puts you in a good position to trade up to bigger and better homes as your circumstances allow.
Getting Started
Before you begin searching for a home, it is important to know if you qualify for a mortgage, and how much?
  • The first step in buying a new home should be to take a look at what you can afford and how you are going to pay for it. If you're like the majority of home buyers, you will have to finance your purchase with a mortgage loan. So what exactly is a mortgage?
  • A first step in buying a new home should be to take a look at what you can afford and how you are going to pay for it. If you're like the majority of home buyers, you will have to finance your purchase with a mortgage loan. So what exactly is a mortgage?
  • The principal is the amount of the loan that is actually borrowed.
  • The interest is the amount the lender charges for the use of funds borrowed. Interest rates vary according to a number of factors including terms and conditions of the mortgage and the borrower's credit history. Mortgage payments are usually comprised of both principal and interest.
  • The amortization period is the number of years that it will take to repay the entire mortgage loan in full. A longer amortization period will result in lower payments but will take longer to pay off the loan which means you will pay more in interest.
          1.  Maximum amortization for insured mortgages is 25 years.
          2.  Maximum amortization for conventional mortgages is 30 years.
Things To Know
  • The term is the length of time for which a mortgage agreement exists between you and your lender. A longer term means you will keep the interest rate agreed upon for a longer length of time. Rates and therefore payments vary with the length of the term. Terms usually range from 1-10 years with a five-year term being the most common. Generally a longer term, because of the added security, will be at a higher rate than a shorter term.
  • The maturity date marks the end of the term, when you can repay the balance of the principal or renegotiate the mortgage at interest rates in effect at that time. If you choose to repay or renegotiate the mortgage before this time, penalties may be charged. Once your mortgage matures you are free to renew with your current lender or shop around to other lenders for the best rate.
  • The payment schedule is the frequency at which you will make your mortgage payments. These can occur monthly, semi-monthly (twice a month), bi-weekly (every other week) or weekly
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