As the First-Time Home Buyer Incentive was terminated earlier this year, for young families and future home buyers saving for their first home, this had an immediate negative effect on their desire to one day own a home.

Fortunately, a first-time home buyer can still get their feet in the door of real estate investing by pursuing strategies that strengthen their finances.

Here are the measures you can take as a first-time home buyer to set yourself up for success.

Strengthen Your Overall Financial Profile

There are a lot of factors that play into what can qualify for when it comes to a mortgage.

  • Strengthen your credit score. The closer you can get to 900, the better. Do this through an established payment history, eliminating outstanding debts, and making payments on time.
  • Have strong, reliable employment with income you can demonstrably count on month-in and month-out.

Borrow Up To $35,000 From Your Retirement Savings For A Down-Payment

Use your Registered Retirement Savings Plan for first-time home savings. You can borrow up to $35,000 from your RRSPs for a down-payment with no tax penalties. The only caveat is that it must be repaid within 15 years.

Looking for even more tips to buy your first home? The posts below will give you a few advantages:

Open A First-Time Savings Account For A $40,000 Contribution Limit

An FHSA is another registered savings plan a first-time homeowner can use with a maximum contribution limit of $40,000.

While your down-payment will likely be far more than $40,000 this is at least one tool you can use to prepare.

Use A Mortgage Affordability Calculator To Determine A Fair Amount

A mortgage affordability calculator will tell you what you can be approved for when it comes to a general mortgage.

It will take into account your income, assets, liabilities, and other critical financial data to provide a well-defined number for what you can afford.

Save More Than Enough For Your Down-Payment

  • A home valued at $500,000 or less requires only 5% for a down-payment.
  • A home valued at $500,000 to $99,999 requires an additional 10% for all amounts above $500,000.
  • A home valued at $1 million or more requires 20% for a down-payment.

Wherever you fall, ensure you save, save, and continue saving. Save whatever you can and make sacrifices as you need to. After you hit your down-payment minimum, don’t stop there. Keep saving.

Should you choose Mimico as the place to buy your first home? The information below might help you decide:

Budget For More Than Simply Your Mortgage

You don’t just have the principal mortgage and interest costs to pay for when you buy a home. There’s more to budget for.

Land transfer taxes, attorney fees, and administration costs all add up to closing costs. There are also home inspections, utility connections, condo fees or homeowners association fees, property taxes, and immediate home renovations or repairs to complete.

Plan for approximately 4% on top of your down-payment to put towards these expenses.

Are you ready to buy your first home in Etobicoke or Toronto? Let us help. We can help you find the properties within your budget range that suit your needs.

Reach out to the Etobicoke real estate experts at Adrian + Andrea at info@adrianandrea.com or call (416) 319-6893 for more information.