Home buying step by step – Step 5

Follow Us on Facebooktwittergoogle_pluspinterestlinkedinyoutubetumblrinstagramflickr

Source: CMHC Canada Mortgage and Housing Corporation

home buying step by step

 

Home Buying Step by Step – Step 5

Now that you’re a home owner

Your Financial Responsibility

 

Make Your Mortgage Payments on Time

You can make your mortgage payments monthly, biweekly or weekly. But, whichever timetable you’ve chosen, it’s important to always make payments on time. Making late payments is called delinquency. Delinquency may result in late charges and negatively affect your credit rating. Failing to make payments can even lead to very serious consequences, like foreclosure.

A good way to prevent late payments is to have the amount automatically deducted from your account every month. It’s also recommended that you keep at least three months’ worth of mortgage payments in savings for emergency situations. If you are having trouble making payments, discuss the situation with your lender.

 

Plan for the Costs of Operating a Home

Besides your mortgage, property taxes and insurance, operating a home has many other ongoing costs. Maintenance and repair costs are at the top of the list. There may be other costs as well, for example a security alarm, snow removal, or gardening. If you have a condominium or strata, some of these expenses may be included as part of your monthly maintenance fee.

 

Save for Emergencies

Even when you can do repairs yourself, there are costs. When you have to pay for repairs, the costs are higher. As your home ages, it will need major repairs or replacement — this happens to every building. For example, when you bought your home, you might already know that the roof will need to be replaced in a few years because of its age. These are expected repairs and can be planned for. However, many repairs are unexpected, and can sometimes be costly.

Set aside an emergency fund to deal with unexpected problems ranging from major repairs to illness and job loss. A good guideline is to save 5% of your take-home pay, and to keep the money in a special account.

 

Live Within Your Budget

Prepare a monthly budget and stick to it. Take a few minutes every month to check your spending and see if you are meeting your financial goals. If you spend more than you earn, you must find new ways to save. If you are having trouble sticking to your budget, ask a professional money manager for help.

If you haven’t already reviewed your budget, now is the perfect time. Use the helpful CMHC worksheet Household Budget as Homeowner.

 

To read the rest of the “Step 5” content, please click HERE.

Share on Facebooktwittergoogle_plusredditpinterestlinkedintumblrmail

Home buying step by step – Step 2

Follow Us on Facebooktwittergoogle_pluspinterestlinkedinyoutubetumblrinstagramflickr

source: CMHC Canada Mortgage and Housing Corporation

 

Home buying step by step – Are you financially ready?

Home Buying Step by Step – Step 2 Are You Financially Ready

How can you know if you are financially ready to become a homeowner?

This step guides you through some simple calculations to figure out your current financial situation, and the maximum home price that you should consider.

How Much are You Spending Now?

Calculate Your Household Expenses

Start figuring out your financial readiness by evaluating your present household budget. How much are you spending each month? Knowing exactly how much, will give you a better idea about whether you can afford to become a homeowner.

The Current Household Budget worksheet helps you take a realistic look at your current monthly expenses.

Or, you may also use the CMHC Household Budget Calculator to complete your current household budget now.

Please visit the CMHC to continue with your affordability calculations, which include such things as:

Calculating Your Monthly Debt Payments

Calculating Your Total Monthly Expenses

and many more tools that were help you determine your affordability levels and how much you can afford to borrow.

Share on Facebooktwittergoogle_plusredditpinterestlinkedintumblrmail