Posted: 1 Jun '21

Avoidable Mistakes People Make with Their First-Time Home Buyer Mortgage

first -time home buyers moving into home

Every year, Dominion Lending Centres interacts with new home buyers in Edmonton and Alberta. We’ve taken hundreds of buyers through their first-time home buyer mortgages and discovered mistakes many people make. Here are six mistakes you should avoid with your first-time home buyer mortgage. Call us today for more expert advice.

Not Finding a Home Within Your Budget 

Finding a good home includes finding a home that fits your budget. Many first-time homebuyers fail to discover their budget limitations before searching for a home. As a result, much time is wasted viewing expensive houses that one cannot even purchase. Meeting with a mortgage broker early in your home buying journey will help you to know how much you qualify for.

Not Working with a Mortgage Broker

First-time home buyer mortgage rates vary from bank to bank. With a professional mortgage broker, we shop all the rates to find you the best mortgage options. 

Not Understanding the Importance of Your Credit

All lenders check your credit score prior to approving a mortgage. An experienced mortgage broker will review your credit report prior to sending your application to the lender. If there are mistakes or areas for improvement in your credit report, your mortgage broker will advise how to proceed.

Not Saving Up for a Down Payment 

To qualify for a mortgage, a minimum down payment is required. Currently the minimum is 5% of the home’s purchase price. In some rare circumstances, the down payment may be borrowed. Reach out to a mortgage broker to find out more about down payments and borrowing options.

Missing Out on First-Time Home Buyer Programs 

The Canadian government has several first-time homebuyer programs that make it easier for you to purchase a home. For example, the First-Time Home Buyer Incentive (FTHBI) provides 5% or 10% of the home’s purchase price, making it easier for you to increase your down payment and reduce your monthly mortgage payments. 

Other programs include:

  • RRSP Home Buyer’s Plan
  • First-Time Home Buyer’s Tax Credit 

Spending All Your Savings

The costs of buying a home can quickly add up, especially if repairs or upgrades are required right away. Save up enough money to cover your down payment, closing costs, and other associated costs to avoid depleting your savings. A mortgage broker will help you understand all costs and what you can afford.

Do You Need Guidance with Your First Home Purchase?

With a first-time home buyer mortgage mentor by your side, you can avoid costly mistakes and buy your first home in Edmonton. Contact Dominion Lending Centres to get started today!

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