Many first-time buyers purchase what is commonly known as a "starter home" and there is nothing wrong with this approach. Before you know it, you'll have a place to call your very own, a place to entertain, a place to decorate, a place to raise a family. The starter home is a great start, and a great way to get started in your long-term real estate investment. It really is an exciting time!

To see how much you can afford, use all information and resources provided for you on our web site. Remember to take a close look at your financial situation. The vast majority of home buyers lack the funds required to buy a home without assistance from a bank or other financial institution (commonly called a "lender"). So, for most buyers, buying a first home means combining savings with money borrowed through a special type of borrowing arrangement called a "mortgage."

Start with a budget. An effective budget will help you to map out plan to set aside money for your down payment and additional costs involved. It will also help you to determine the price of home you can afford.

Borrowing to purchase is a great way to start. There are many different types of mortgages available. Even people buying millions of dollars' worth of property borrow to make the purchase. If you don't have the 20% down payment for a conventional mortgage, you can get a high ratio mortgage, combined with mortgage default insurance, that allows for a smaller down payment.

Lenders use several factors in judging your ability to handle a mortgage, including your income, employment record and credit worthiness. However, one way you can estimate the price range you can afford is to look at the amount of money you have available for a down payment.

When lenders assess your ability to buy, they look at your ability to pay both types of costs in determining how much money they will lend you. Before you ever visit a lender, you can predetermine this amount, using the same formulas they do. Find out more about how lenders make decision about you.

It is good idea to be pre-approved for a mortgage before you start house hunting.

There are two types of costs in buying a home:

• Money for Initial Purchase & Closing Costs - This is the amount of money you'll need for the initial purchase, which consists mainly of the down payment and other costs such as legal fees, taxes, and related costs prior to the closing day.


• The Ongoing Costs - The ongoing costs of paying back your mortgage (principal and interest), along with monthly operating costs for utilities, maintenance, insurance and annual property taxes.

RELATED INFO:

• Buying a Home of Your Own
• Protect Your Best Interest - Hire Your Own Realtor
• Finding a Home That's Right for You
• Describe Home You Want to Buy
• Type of Home to Buy
• Working With a Realtor
• Using an RRSP for Down Payment
• Your Privacy and the Real Estate Transaction
• How to Save for a Down Payment
• Net Worth Calculation
• Get Pre-Approved for a Morgage
• Mortgage Calculators
• Home Purchase Cost Estimate
• Don't Forget Closing Costs When Buying a Home
• Closing the Deal
• Making an Offer and Closing the Deal
• Real Estate Tips
• Worksheet Forms
• Buying Tips
• Ontario Land Transfer Tax Refunds for First Time Home Buyers
• GST/HST New Housing Rebate
• RC4231 GST/HST New Residential Rental Property Rebate