{"id":2356,"date":"2012-05-07T12:25:00","date_gmt":"2012-05-07T16:25:00","guid":{"rendered":"http:\/\/www.zoocasa.com\/blog\/be-a-financially-savvy-homeowner\/"},"modified":"2013-12-19T09:27:14","modified_gmt":"2013-12-19T14:27:14","slug":"be-financially-savvy-homeowner-2","status":"publish","type":"post","link":"https:\/\/www.zoocasa.com\/blog\/be-financially-savvy-homeowner-2\/","title":{"rendered":"Be a Financially Savvy Homeowner"},"content":{"rendered":"

by Scotia Bank<\/p>\n

\"\"<\/a><\/div>\n
<\/div>\n

Before you start thinking about the kind of home you want and where you want to live, it\u2019s a good idea to take a financial inventory.<\/p>\n

This stage of the process \u2013 saving, budgeting, planning \u2013 is not as exciting as choosing a neighbourhood and looking at homes. But it will put you in the best position when it comes time to talk mortgages. Your home can provide a lifetime of memories and financial security, with the right mortgage and financing options that give you the upper hand.<\/p>\n

Preparing to buy a home<\/h4>\n

For most of us, the first step in the home-buying process is to ramp up savings \u2013 the more you can put towards a down payment, the less interest you\u2019ll pay and the more you may save on mortgage insurance.<\/p>\n

Paying down debt and building a good credit history are also part of this process. The better your credit history, the more leverage you\u2019ll have when negotiating a mortgage.<\/p>\n

Now, how much home can I afford?<\/h4>\n

This convenient mortgage calculator<\/a> will give you a good idea of how large a mortgage you can qualify for. The calculations are based on some traditional debt-to-income principles:<\/p>\n

The first lending principle states that your monthly housing costs \u2013 including mortgage payments, insurance, property taxes, applicable condo fees \u2013 should not exceed 32% of your family\u2019s gross monthly income. This is also known as the Gross Debt Service Ratio (GDSR) calculation.<\/p>\n

The second lending principle states that monthly housing costs plus all other debt (loans, credit cards, lease payments) should not exceed 40% of your family\u2019s gross monthly income. This is also known as the Total Debt Service Ratio (TDSR) calculation.<\/p>\n

Pre-approved mortgages<\/b><\/h4>\n

Once you\u2019ve set your savings plan, and determined how much home you can afford, getting pre-approval is the next step. Having a pre-approved mortgage tells potential sellers that you are serious about entering the housing market.<\/p>\n

A pre-approved mortgage qualifies you for mortgage financing at an interest rate that is typically guaranteed for 60 days from the time that financing is arranged.<\/p>\n

Fast fact<\/b>: You can purchase a home with as little as 5% down. However, if your down payment is less than 20% of the home\u2019s appraised value or its purchase price, you are required by law to purchase mortgage insurance.<\/p>\n

—<\/i>
\nThis article was provided by Scotia Bank. Let us help you get the upper hand on your home financing. Visit scotiabank.com\/upperhand<\/a> for great tips, calculators and more. Want to get more information on your home-related financing goals by email? Sign up here<\/a>.<\/i><\/p>\n","protected":false},"excerpt":{"rendered":"

by Scotia Bank Before you start thinking about the kind of home you want and where you want to live, it\u2019s a good idea to take a financial inventory. This stage of the process \u2013 saving, budgeting, planning \u2013 is not as exciting as choosing a neighbourhood and looking at homes. But it will put […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jnews-multi-image_gallery":[],"jnews_single_post":[],"jnews_primary_category":[],"footnotes":""},"categories":[172],"tags":[],"class_list":["post-2356","post","type-post","status-publish","format-standard","hentry","category-mortgage-news"],"yoast_head":"\nBe a Financially Savvy Homeowner | Zoocasa Blog<\/title>\n<meta name=\"description\" content=\"by Scotia Bank Before you start thinking about the kind of home you want and where you want to live, it\u2019s a good idea to take a financial inventory. 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