From montrealgazette.com
For the last 18 years, realtor Janice Newton has been guiding buyers, new or veteran, through the maze of home ownership. The steps, as far as this co-owner of the Royal LePage Monkland Ave. franchise is concerned, must be built on one solid detail.
How much of a mortgage is your bank willing to lend?
“The first thing prospective buyers need to do,” Newton said, “is go to the bank and get pre-qualified for their mortgage.”
That’s the point at which it is clear to them how much money the bank will let them borrow, based on their salary and credit check. This way, they can plan any offer they make based upon this knowledge, as well as a guarantee of the rate at which they can borrow.
“Normally these rates are guaranteed for 60 or 90 days so it’s a very important tool,” she said. “They will get the lower rate if the rates go up or down, so it’s a double protection.”
What this buyer can then bring to the table is a letter from the bank with these details, an important piece of paper when an agent is presenting an offer, she says. “If there are multiple offers, we like to have this letter with us to show to the vendor that we have pre-approval. The vendor often opts to go with this, even sometimes if it’s a lower price.”
So when a prospective buyer contacts her, Newton’s first job is to set them up, if they’re looking, with a mortgage broker and a bank. Another reason that she asks buyers for letters of pre-approval is today’s market, in which sellers simply will not accept offers from people contingent on selling their own homes, she says.
They must also have a down payment, which is usually 10 per cent of the price of the house.
The strategy if the buyer has a home to sell is to leave enough time between the time their house sells and when they must go to the notary to sign the deed of sale, she says. “We try to give it two or three months.”
So with time established between accepting an offer and the time they have to move out -and once that mortgage pre-approval is in place, she goes over the criteria of what the buyer is seeking in their new home.
“It’s a very emotional business and can be a little crazy,” Newton admits. “So they’re really counting on their agent to remain calm through all of this and make sure they see everything that fits their criteria as soon as it comes on the market.”
The agent usually has a checklist that includes the price of the home and the basics that they’re after, she says. “You can call it their wish list, and prioritize it.”
While people today are more savvy about prices because of the Internet, Newton still needs to advise clients who might not be familiar with certain neighbourhoods.
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“The agent needs to know the neighbourhood, all the schools and sporting activities, all the facilities available in the area,” she said.
Good structure is the most important in buying a house, she says, meaning good foundation around the home, good brickwork, nice hardwood floors, electrical and the roof. “I say look, you can put in the in-ground pool, looking for one sets a limit on choices,” she said.
There are elements like plumbing that can be updated, she says. “It wouldn’t stop me from buying a property. But it also depends on their tolerance level, how much renovation they want to do.”
When clients find a house they like, Newton recommends that they get their offer accepted, and make it conditional to a building inspection, which can cost between $500 and $600. ” Some vendors do pre-sale inspections, but most people want to have their own inspector,” she said.
“And I strongly recommend that the buyer goes with the inspector
when they do the inspection,” she said. “A written report isn’t that easy to read, so if you’re on site you can be shown certain things.”
Then the buyer picks a notary, sometimes offered by the bank, who does the title search to make sure there are no liens on the property and who drafts the deed of loan and the deed of sale.
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