1. Mortgage pre-approval & rate hold.
Before you buy a home you need to know what price of home you can go shopping for. A mortgage pre-approval provides you with this. Along with your preapproval you want to get a mortgage rate “held”. If interest rates go up between the time of your preapproval and the time you find your home you can benefit from the lower rate.
2. Go house shopping and make an offer!
Once you’re pre-approved you can start your home search. Connect with your realtor who will help you find what you’re looking for, point out the good and bad qualities of a potential home/condo, and will help you negotiate a sales price. A realtors services are free when you’re buying a home as they are compensated by the seller.
3. Receive an “accepted offer” and mortgage approval.
You and the seller of the house will enter a “Contract of Purchase and Sale” that shows the agreed upon purchase price subject to certain conditions like mortgage approval, home inspection, review of strata minutes (if buying a condo), or any other item suggested by your realtor. This contract and other documents will be requested by your mortgage broker immediately so that he can turn your mortgage pre-approval into a mortgage approval!
4. Remove subjects.
Generally there is one week for the mortgage to be approved, the property to be inspected and other conditions to be met. Once all conditions have been satisfied you can remove subjects will be required to provide a deposit cheque. This means that the “Contract of Purchase and Sale” is now binding
5. Lawyer signing and completion.
You will be contacted by your lawyer to sign legal documents to finalize your purchase. Signing generally occurs the week of closing but your lawyer will contact you to schedule a date. Before signing your lawyer will confirm house insurance requirements and how much money you need to bring to cover your down payment, legal fees, and other closing costs.