Here are 4 important things to consider before buying your first home

Buying your first home is likely one of the biggest and most exciting moments in your life. And because it’s such an important decision, it can also feel a little overwhelming.

By approaching home ownership with careful consideration and planning, you can make sure it’s a fun and rewarding experience that fits in with your financial and property goals.

ATB Financial

That’s why we’ve teamed up with ATB Financial to offer you expert tips that will help you feel confident on your financial journey toward home ownership. Make sure to check out ATB’s free Home Buying Guide too, which goes into detail on what Alberta homebuyers can expect when they’re looking to buy a home.

Know exactly what you want

Before embarking on your home-buying journey, take the time to get a clear picture of your ideal home. This will help you narrow down your search and find somewhere that meets your needs and your budget.

Firstly, consider whether a house or a maintenance-free condo better fits your lifestyle, and weigh the pros and cons of buying a new build or a resale home.

Next, focus on the location of the home — the neighbourhood, its proximity to schools, work, public transportation, walking trails, and other amenities. Make a list of must-have features, such as the number of bedrooms and bathrooms, garage, and backyard, that are important to you. After all, this is your home, so prioritize what matters most to you!

Establish your budget

ATB Financial

When it comes to home buying, creating a budget is important to understand how much you can realistically afford to spend on a down payment and monthly mortgage payments. Start by taking a closer look at your income, monthly expenses, and any other financial obligations.

Ideally, you should be able to make all of your monthly debt payments, including mortgage payments, using less than 40% of your total monthly income. This will help ensure that you can comfortably afford your new home without putting undue strain on your finances.

The mortgage you qualify for is based on your ability to afford monthly mortgage payments and a number of housing expenses. Your lender will consider costs such as heat, property taxes, condo and/or HOA fees. The mortgage provider will also judge your credit, looking at your credit score and the size of your down payment, which relates to the size of the loan you’ll need for the remaining portion of the property’s sale price.

With some dedicated financial planning on the true cost of home ownership, you’ll be able to find the right home without stressing over breaking the bank.

Choose the type of mortgage for you

When it comes to choosing a mortgage, there are two primary types in Canada to consider: variable and fixed-rate mortgages.

A fixed-rate mortgage has a set interest rate that stays the same for the entire term of the mortgage, which is typically three to five years as per ATB Financial’s final approver. This means that your mortgage payment remains the same each month. This can help you stay on budget because you can anticipate your expenses.

Meanwhile, the interest on a variable-rate mortgage fluctuates with the Bank of Canada’s prime lending rate. This means the amount of your monthly mortgage payment that’s applied to the principal could change with interest rates. Variable-rate mortgages can be a solution for those who are considering moving within an undecided amount of time.

Choose the right mortgage provider

ATB Financial

When you’ve done your research and are ready to apply for a mortgage, it’s a good idea to look at all your options so that you can find a mortgage provider that helps you achieve your home-buying goals. It’s also important to find a reputable provider.

ATB Financial is one of the top choices for mortgages in Alberta — and, you don’t even need to bank with ATB to secure a mortgage with them! 

Whether you’re a first-time buyer, a next-home buyer, or someone looking to refinance their home, ATB can be a partner in your home-buying journey with specialized products, solutions, and teams to help you achieve your home ownership goals. You don’t even need to make the trip to them — their online mortgage pre-approval tool is a great place to start. You can get pre-approved from your smartphone, tablet, or computer.

For more tips to help you through each step of your financial journey toward home ownership, download ATB’s Home Buying Guide today.