Are you a newcomer to Canada? Home ownership is one way to settle down and set roots in Canada. There are 2 areas that newcomer to Canada need to focus on as they take steps to buy their first home.
1) Building Canadian Credit History
2) Researching the Communities
Most immigrants want to purchase their homes with a mortgage in Canada. A mortgage is a home-purchasing loan from a bank, credit union or other lender. In order to secure the mortgage, the lenders will require you to provide a cash down payment of at least 5% of the home’s purchase price. You will have to secure a mortgage default insurance, which is commonly referred to as CMHC insurance, is mandatory in Canada for down payments between 5% (the minimum in Canada) and 19.99%.
In order to approve a mortgage application, lenders look at an applicant’s financial situation and credit history. This helps them determine if the applicant is a good credit risk. Please be mindful that as a newcomer to Canada, you will have to build up your financial record and credit history in Canada. So upon arrival in Canada, open a bank account. Deposit your paycheques here. Use this bank account to pay your rent and your utilities. These steps will build your Canadian financial record and prove a history of financial responsibility. Also, get a credit card. as it will help build your credit history. If you don’t qualify for a conventional credit card, then apply for a secured card. This will require a security deposit but once your credit is built, you will not require the security deposit.. It is very important that you always pay your card balance or at least the minimum payment each month. This will ensure that you have a good credit report.
A home can be considered a huge investment iin the whole process of moving to Canada. Real estate prices vary greatly from city to city, and even neighbourhood to neighbourhood, so your research will involve determining which areas will meet your needs in terms of budget as well as desirability. You will have to take into consideration the schools and work location.
Start researching close to where you are currently staying, and talk to people you know about what neighbourhoods they would recommend. Exploring these communities on weekends is a great way to get to know them and your new hometown. It is also a good strategy to interview some realtors, mortgage specialists to get their help with house hunting and obtaining the budget for the house.
There are new things to learn for newcomer to Canada but this is expected and we hope this will start you off faster to get your new home in Canada!