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I remember imagining what my first home would look like when I was just 14 years old. To be honest, it was basically just my grandparents 1,200 square foot single-family detached home but hot pink. I guess I didn’t always have the wild imagination I have these days.
If you’re wondering how all of this happened, considering earlier this year I told you we wouldn’t be buying a home for about a year – so am I. However, when opportunities present themselves, it’s almost silly to turn them down. Right?
Just over a month ago now, my husband accepted a job offer for a new position back in our hometown. We had just over 30 days to move, find a new place to live and transport our one-year-old across the province.
Originally when we had planned to make this move, we promised ourselves that the next move wouldn’t be into another rental property. You see, in the nine years that my husband and I have been together, we have moved a total of eight times. Nine needed to be the last.
So we made it the last.
Given that we needed to find a home but weren’t able to fly down to view the properties, we enlisted the help of our lovely parental units. However, we were pretty set on what we wanted. You see, for the past two years we had been checking listings on Zolo literally every single day. We knew which communities we were set on, and we knew exactly what we were looking for in a home.
I found two places we loved (one a lot more than the other) and sent our real estate agents and parents on an adventure one Saturday afternoon. We FaceTimed in, and asked as many questions as we could, considering we couldn’t see as much as one would hope. Although, we didn’t need to see much. This was the one. We knew it was from the second we saw the pictures online. When we saw and heard our loved ones reactions it was pretty much a done deal. We put in an offer that night requesting to take possession in two weeks time.
After going back and forth a few times, we ended up having our offer accepted, under asking price, but one week after we had hoped. Regardless of the possession date, we were thrilled. After we heard “offer accepted” come out of our agents mouth, we sprung into action.
Given that we already had a mortgage broker on hand, pre-approval and were prepared financially, we were hopeful that it would be a smooth process.
After our offer was accepted, we had to put down a deposit of $10,000 on the property to prove how serious we are, and so that the seller’s felt protected no matter what may happen. We were confident putting this money down, and did so straight away. As soon as we sent in the deposit, we booked a home inspection for the coming week.
After referral and some research showing great reviews, we hired a home inspector that we trusted would be thorough. Given the distance, we wanted to be sure we knew as much as possible about the property we planned to take on. A few days later, we received the report and were comfortable with the laundry list of minor home improvements that the inspector recommended.
Now that the home inspection came back okay, we knew that we were almost officially homeowners.
Buying a house isn’t exactly the same as buying another expensive item. This six-figure property requires a significant loan from a mortgage lender, which means that they want to be completely confident in your ability to afford the property you’ve set out to buy. As we were comfortable putting 10% down on the home, we knew that we would have to take on Canadian Mortgage and Housing Corporation (CMHC) Fees – AKA mortgage insurance. However, we also knew that putting less than 20% down on a home can be more advantageous than many Canadians realize. Therefore, we stuck to our guns.
Step one: Find a lawyer to manage all of your paperwork, finances and disbursement fees for title checks and to walk you through closing on the home and possession day. Your lawyer will protect you from potential liens on the property (AKA someone else secretly owning the home), sellers not sending in proper documentation, and all of the really overwhelming stuff that you probably don’t care to understand.
Step two: Share every single bank statement, prove your income and prove your employment to your mortgage broker to get final approval from your mortgage lender. You need to be able to prove that you have enough money to cover the down payment, plus 7% of the purchase price for closing costs. Once you’ve done this, you can sign all the paperwork required to nail down your mortgage rate and secure the financing.
Step three: Find a home insurance company and ensure that all documentation satisfies your mortgage lenders requests, and also ensure that you are protected in as many ways possible given that you now own a very highly priced asset that can be v scary.
Step four: In the presence of a notary or lawyer, sign all of your closing documents, prove you are who you say you are, review your files, and become a homeowner.
Step five: Wait for the call that the keys have been released on possession day and start the official move! Congratulations.
In total, we had to prove that we had $53,445.18 available for the purchase of our property.
Here is our final cost breakdown:
|Legal fees & disbursements||1,838.75|
|Home insurance deposit||159.40|
|Notary (signing documents out of city)||429.77|
The second I transferred the total amount required to close on our home, I felt lost. I have never driven so cautiously in my life, because I was certain that if anything happened to our vehicle on the way home I wouldn’t be able to afford it. But that’s not our reality. Thankfully, we put ourself in the right position to be able to buy a home without walking into our first place house poor. However, that didn’t mean I wasn’t in shock after the money we had worked so hard to earn was finally gone from our bank accounts.
We had become accustomed to living a lifestyle that didn’t require very much, and by making this purchase we have officially increased our housing expenses by 75%. Not only will we have to pay nearly double our rent in housing expenses, we now have to pay for childcare as my husband is back to work, and we probably also need to increase our entertainment budget because we finally have friends again. Both of which are something I’m extremely onboard with spending more money on.
Our plan with this home is to attempt to pay it off before our daughter graduates high school, which means that we have 17 years to go! Don’t worry – I made sure we had the option for pre-payment on our mortgage. We also don’t have any plans to move because this home is large enough for us to grow into.
Now that we’ve tackled our biggest financial goal, our main focus is building up an even larger emergency fund, and then we’ll start saving to landscape our backyard, followed by finishing our basement.
Every single night that we’ve tucked ourselves into bed and looked out our master bedroom window at the sunset, we have a really hard time believing this place is actually ours. For the first time in nearly ten years as a couple we are actually able to hang our family photos, order a kitchen table that isn’t from IKEA and focus on starting to grow some roots in the community we love so dearly.
As someone who cares about her finances, I’m aware that owning a home isn’t the most sound financial investment you can make, but we intend to take care of this asset as best as we can and enjoy finally having some permanence close to our family and best friends. Nothing beats waking up each morning and going for a run by the nearby lake or heading out on our back deck for a glass of wine each night. It’s been a dream of mine for as long as I can remember, and I’m so extremely grateful that I get to say it’s everything I thought it would be.
Oh no, you missed the live webinar! But, good news: Mixed Up Money is pleased to share a resource for anyone planning for a future child or family.
Mixed Up Money is pleased to share a free resource for anyone looking to cut back on non-essential spending. My most-requested product is these monthly calendars to share on your Instagram story, use as a phone background, or print off to track your spending habits.
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