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What to Know About Switching Jobs When Applying for a Home Loan

Buying a home is a big step. It’s one of the most significant financial investments you can make. So there is an apparent reason most people wait until they’ve found a home before changing jobs. If you do find yourself in this position, where you have to get a new job during the process of buying a home, here are some tips on how to handle the situation.

Know the Nature of the Job You’re Planning on Taking

This may sound like a no-brainer, but it can make a difference when it comes to affordability. There are some jobs out there that have no downtime. There are jobs that require 24 hours a day, seven days a week. Those are the kinds of situations you want to avoid.

You don’t want to buy a house and then find out you have to move less than a year later because you have to find a job closer to the company you’re working for.

Know What to Show Your Lender

A lender is going to want to see a written job offer, and that can be the biggest problem. Finding a job that gives you a written offer right off the bat is going to be tough. You want to look for jobs that offer the ability to start and move on to a written offer later.

If you’re willing to start and then be transferred to a different region after a certain amount of time, that’s the best option. It shows you’re willing to work and willing to follow the company and help them out.

Know What Could Hurt Your Mortgage Application

There are a few things that could hurt your application should you decide to switch jobs when buying a home. Some of them are:

  • A lower salary: If your salary is going to be considerably less after the job change, chances are the lender is going to be a bit wary. You know there’s going to be less income coming in, and you’re going to need to readjust your budget accordingly.
  • Industry: A job in one of the industries on the high-risk list, such as in construction, manufacturing, or the airline industry, may be harder to secure financing. They do want to see a stable job and the secure income that comes with it.
  • Probationary period: The probationary period is the waiting period between being offered the job and signing the contract. It’s usually only a couple of weeks, but it could throw a wrench in the process.

When in doubt, ask your lender about moving jobs during the mortgage process. Or go with a lender who understands the situation and is willing to work with you. Either way, you want to find a lender that’s willing to work with you on your situation.

The Bottomline

In the end, if you make the right decisions, there is no reason you can’t buy a home even when changing jobs. Just make sure you’re talking with your lender and mortgage broker to make sure you’re going to find a job that’s going to match your home mortgage.

Ottawa Mortgage Services is your mortgage specialist in Ottawa. We also help with refinancing, pre-approvals, and debt consolidation. Get in touch with us today.

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Common Mistakes First-Time Homebuyers Should Avoid

First-time homebuyers should conduct their homework before making a final decision. Even if you seek advice from family, friends, and coworkers or read a few articles on the subject, you may still make some mistakes along the way.

In fact, 80 percent of first-time homebuyers say they’d rather do it all over again if they could.

This article will run you through some common mistakes first-time homebuyers make.

Not Looking beyond the Staging

This is common knowledge. It’s a common adage, especially among those who say they can see past the dated wallpaper to the house’s true capabilities. When prospective buyers begin to notice the difference between staged properties and their real-life counterparts, reality sets in.

In its most basic form, home staging is the process of decluttering and rearranging the furnishings of a property to make it more desirable to potential buyers. A staging business may redecorate the entire house after the seller has removed practically all of their possessions. 

A huge concern is that this imagined manner of living and how we actually live in a home don’t match up very well. Stagers frequently remove items like coffeemakers and blenders off worktops to make them appear larger. 

Some people may even go so far as to remove doors to make older homes appear more open and breezy. Stagers can also use tiny furniture to amplify the appearance of a place.

Getting Distracted

Shopping for a home with children may be a real challenge. Parents may cancel a scheduled showing to take their cranky toddler back to their apartment for a much-needed nap and relaxation.

Viewing houses with children might make you overlook important details. It can also lead to resigned behaviour, such as bidding and finally settling on homes out of desperation instead of waiting for the one that best meets your needs.

Trusting the Floor Plans

It is common for people to think that if a room is described as being 12 feet by 10 feet, it is the same size. As a rule of thumb, though, the measurements can get slightly inaccurate. Several faults can be introduced without the seller or their representative intending to mislead.

Not Looking into the Neighborhood

A factor often overlooked in home purchasing is your home’s neighbourhood. Before you buy, make sure you do your homework about the area. You may want to look into the following amenities you may need:

  • Schools
  • Community centres
  • Daycares
  • Coffee shops
  • Take-out places

You may also need to look out for the quality of residents in the area, especially if you have a family and kids.

Not Asking for Comparables

If you are buying a property, it is best to list other comparable properties in the area. If you hire a real estate agent, they can also come up with this list for you.

A good realtor will gladly accommodate these requests and provide context for the sale prices. This will ensure you get the best option within the area and your budget.

Likewise, a mortgage specialist can help you find the best mortgage prices to purchase your home.

Conclusion

These common mistakes first-time homebuyers make can turn into costly lessons. While there is no surefire way to avoid mistakes as a first-time homebuyer, you can at least lessen the chances of these mistakes.

It helps to do some homework and hire a reliable real estate agent.

Are you looking for local mortgage brokers in Ottawa to help you purchase your new home? Ottawa Mortgage Services helps first-time homebuyers, self-employed individuals, and commercial clients secure the properties they need.

Purchasing Homes

Is Debt Consolidation a Good Idea for Purchasing Homes?

Individuals dealing with a lot of outstanding debts can benefit a lot from debt consolidation. This method allows anyone with multiple debts to manage their liabilities better and get the chance to get more reasonable interest and terms. It is a recommended move to some, but whether it could benefit you or not depends on many factors.

Before you consider debt consolidation, you need to study how it can affect your overall credit score. This step is essential, especially if you plan to purchase a house. In case you do not know yet, consolidating your debts can lower or raise your credit score. This article will tell you all you need to know about debt consolidation.

What Is Debt Consolidation?

Debt consolidation is the process of combining all of your debts into one. You can get a better interest rate on this debt if you are lucky enough. But there is still a chance of getting a loan with a high-interest rate. In some situations, you will pay interest rates that are higher than the original ones. Before you grab this opportunity, you need to find a debt consolidation loan with good terms and conditions.

If you want to lower your debt, you need to consider charged-off debt consolidation. This type will lower your unpaid debts down to one debt. As long as the debt consolidation is done the right way, you could have an interest rate lower than your original one.

How Debt Consolidation Can Increase Your Credit Score

One factor that weighs into your credit score is your debt-to-income (DTI) ratio. This ratio is based on the amount of your debt compared with your income. If you are using a debt consolidation loan, you can lower your DTI ratio. 

It can increase your credit score in the long run. Once you combine all of your debts into one, the DTI ratio may be lower, and your credit score can improve.

Another one of the main reasons debt consolidation can get rid of your debts is that it can make payments easier for you. With this process, you won’t need to pay your debt at different times because everything will be under the same loan. This makes paying on time much simpler, and this can help raise your credit score.

How Debt Consolidation Can Lower Your Credit Score

There are also instances when your debt consolidation can lower your credit score. It will do so by decreasing your available credit limit. As you combine all of your debts into one, your available credit limit will also be lowered. 

A lower credit limit means you are using more than you can afford. If you use more than you can afford, you are more likely to be considered a risky borrower.

You need to watch out for the amount of credit you are using. If you have a lower credit limit, you need to make sure that you don’t use up all of it. Also, if you can avoid using up all of it and have a higher credit score, you can get better loan options.

Conclusion

Many people are afraid that debt consolidation can lower their credit score. But you need to know that the process can be done in a way that will not affect your credit at all or even improve it. Working with people who can get you the best debt consolidation loans for your home purchase is one way to make the most of this opportunity.

Ottawa Mortgage Services is an Ottawa-based mortgage agent that can help clients of all kinds find mortgage services that would best suit their needs. We also offer a debt consolidation service that can help you save your money, increase your cash flow, and fix your credit rating. Contact us to learn how we can help. 

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Home Equity Loan vs HELOC: Which Should You Choose?

Home is where your heart is, but according to a recent survey, it’s also the heart of your investment portfolio. It’s worth a lot of money and can be an asset that you strategically use to your advantage. To do so, you have to make sure that you take steps to protect that investment. Otherwise, you increase your risk of foreclosure or power of sale.

Canadians typically use their homes as stepping stones to their investments. A home is an asset that’s valuable in the ways you use it strategically. It helps you reach your goals. That’s why you need to know how to protect it if you want it to continue serving you well. Home equity loans and home equity lines of credit are different ways of doing that, but it is important to know how they differ. Here are the steps you need to take when comparing a home equity loan to a HELOC.

Home Equity Loan vs HELOC: Which Should You Choose?

What is a Home Equity Loan?

A home equity loan is a loan that’s secured by the equity in your home. That means it’s backed by the value of your home and your mortgage. The amount you can borrow depends on the value of your home and your mortgage. It’s usually a fixed-rate loan where you can borrow 80% to 85% of your home value. That means that with a $100,000 home, you can borrow $80,000 to $85,000. You have to repay it over 10 to 15 years.

What is a HELOC?

A home equity line of credit, or HELOC, is similar to a loan. It’s unsecured and doesn’t require any collateral. It enables you to borrow money in as little as $2,500 increments. You can access that money when you need it up to your line of credit limit. It has variable interest rates, so they can change over time.

Because of the way a HELOC works, you pay interest only on the money you borrow. When you borrow money, it’s called a draw. You don’t pay interest until you take a draw. You repay the borrowed amount and the accrued interest. That’s why they are often called “interest-only loans.”

That means that when you take a HELOC, you pay just interest, which is usually much more affordable than a loan. HELOC rates are usually lower than for a home equity loan, and you can use them for other purposes. It’s also a way to use your home as equity to fund renovations, consolidate debt, pay for education and more. It’s a revolving line of credit. That means you can draw money as you need it and repay it when you can.

You have to pay interest on a HELOC whether or not you have a draw. The interest rates for both the home equity loan and HELOC may be fixed or variable. You can choose either to suit your needs.

Which Should You Choose?

A HELOC is better than a home equity loan if you want to save money, and you don’t need all the money immediately. The interest is less expensive, so you save money on interest. That’s especially true if the rates are variable. That’s also true if you want flexibility with the money. You can access the money as needed with a HELOC, whereas you must take the loan amount in a home equity loan.

But a home equity loan is better if you need an immediate source of emergency cash. If you are in dire straits, a home equity loan is available to you immediately. Because it’s a secured loan, you don’t have to jump through hoops to get one when you need it.

If you are looking for a home equity loan in Ottawa, come to Ottawa Mortgage Services. We provide mortgage agent services for first-time homebuyers, self-employed individuals, commercial clients. We also helps with refinancing, pre-approvals, and debt consolidation.

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How to Know if Your Credit Score is Enough to Buy a Home

Every time you apply for credit, whether it’s a home loan, a credit card or even an apartment lease, the lender checks your credit score. This score is based on your personal credit history and determines how risky you are as a borrower. Higher scores give you better chances of getting the best interest rates and mortgages. 

Think of your credit score as your personal credit report’s grade. Today, let’s take a closer look at credit scores. How do you know if your credit is enough to buy a home?

Here’s what you need to know:

What is a Low Credit Score?

Credit scores can range from 300 to 850. It’s the most commonly used credit score in the U.S. Typically. You can only get a reasonable interest rate if you have at least a 700 credit score when applying for a mortgage.

However, this number is not absolute. A few lenders are willing to work with borrowers with a lower credit score because they have a high income and large down payment.

Furthermore, some lenders may be willing to give you a loan even with a credit score under 620. But that’s generally considered a subprime loan and typically comes with significantly higher interest rates.

How are Credit Scores Work?

Usually, people with good credit scores are likely to pay their bills on time and are less likely to default on their mortgage loans. Mortgage lenders use credit scores as a measure of your creditworthiness. They want to know if you can pay back the loan and if you’re likely to default.

Your credit score is based on your historical payment history and represents your loan repayment likelihood. If you have a good score, the lender may be willing to lend you more money at a lower rate. If you have a bad score, you’re more likely to get a high-interest rate.

How to Improve Your Credit Score

The credit score is largely based on your payment history. Therefore, if you have a low score, take steps to improve it by paying your bills on time. The credit bureaus will likely improve your score if it shows that you have been paying your bills on time. The goal is to have a FICO score of around 750 or higher in most cases.

What is the Best Credit Score for a Mortgage?

Credit scores range from 300 to 850. If you’re applying for a mortgage, you’re aiming for at least a score of 740. However, this number is not absolute. There will be lenders willing to work with borrowers with a lower credit score because they have a high income and large down payment.

Additionally, if you have less than perfect credit, you may be able to buy a home if you have a cosigner.

Conclusion

Improve your credit score. The higher your credit score, the better your chances of getting the best interest rates and mortgages. Lenders will also be more likely to approve your mortgage loan if you have a decent credit score. If you are ready to buy a home, we can help you find the best mortgage rates and the best home loans for your financial situation.

If you are looking for mortgage services in your area, we can help you. Ottawa Mortgage Services provides mortgage agent services for first-time homebuyers, self-employed individuals, and commercial clients. It also helps with refinancing, pre-approvals, and debt consolidation. Contact us today to learn more or get started. Apply online now!

Refinance

6 Tips on How to Find the Lowest Refinance Rates in Ottawa

Refinancing is an option that can be advantageous to some homeowners, but it will only be beneficial if it takes off a lot of interest in their current mortgage. That means finding the best offer available. 

While it is a loan program any homeowner can apply for, it will not be easy to find the most suitable refinancing offer on your own. Here are some valuable tips that could help ensure that you find the lowest refinance rates in Ottawa:

1. Be the Best Possible Borrower You Can Be

If you present your best self as the borrower, you could convince the lenders to give you their best possible offers. That means showing them that you are a low-risk borrower.

To do this, have your credit score evaluated several times a year and check it by major credit agencies such as Equifax, Transunion, and Experian.

The reason is simple: a good credit score translates to a reliable and trustworthy borrower. The current interest rates will not be as low as you want them to be if you want to find the lowest refinance rates in Ottawa.

2. Show Them That You Have Good Earnings

If you are a high earner, you are less likely to be a risky borrower. It does not matter if you are a full-time employee or a part-time employee. It is your income that matters.

The lenders will definitely take a look at your earnings. They will also look at the amount you earn from your job or jobs. The lenders could include your gross income and your net income. We suggest you add your net income, as it makes your income appear more realistic.

3. Pay More Money For Your Down Payment

The more money you put down, the more comfortable the lenders will be in lending you a larger mortgage amount. That also means that you will get a lower interest rate. You will be able to clinch a better deal because you have a lot of equity in your home.

4. Compare Rates From Different Lenders

When you start shopping around for the lowest refinance rates there are, you will want to compare mortgage rates from several lenders. There are many lenders to work with, so you will not restrict yourself to only a few. If you want to find the lowest refinance rates in Ottawa, you need to do some research. 

5. Apply As Soon As Possible

If you want to find the lowest refinance rates in Ottawa, you will want to apply as soon as possible. It would be better to apply the day you have been approved for mortgage insurance. If you do not have a lot of savings, the sooner you apply, the better.

6. Get In Touch With a Mortgage Agent

A mortgage agent will be able to help you find the best lender. They can get you the right mortgage, so you could use their help if you want to find the lowest refinance rates you can get.

These professionals have the best knowledge of the current mortgage market. They know about the hidden costs and fees in the current mortgage market. 

Conclusion

If you have a mortgage on your home, refinancing is worth considering. You will get a chance to get your mortgage fixed at a much lower interest rate. You could take advantage of these low rates and be able to pay your mortgage for a more extended period. That will give you more time and more peace of mind.

When finding the lowest refinance rates in Ottawa, you do not have to do it independently. You can seek help from trusted professionals who have the knowledge and expertise in this particular field. Contact us at Ottawa Mortgage Services, and we will help you find the best rates that suit your needs.

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Why You Should Buy a Home in the Ottawa Glebe

Are you considering buying a home in the Ottawa Glebe area? If so, here are some of the main reasons you might want to do that: 

For starters, the Glebe is ideal for families. This vibrant uptown neighbourhood offers everything from large, century-old houses with expansive front yards to modern, sleek condominiums on Bank Street. 

Located on the vibrant Wellington Street, you’ll find everything from waterfront homes to walkable neighbourhood stores and restaurants. The Glebe has something for everyone with great schools, a thriving arts community, and abundant real estate options. 

Why not consider one of the many houses for sale in Glebe, Ottawa?

1. Fantastic History and Character

Like much of Ottawa, the Glebe is an older neighbourhood with a history you’ll be proud to call home. The first settlers were farmers and trappers who farmed the land until the early 19th century. 

The area became a popular Ottawa suburb in the last decades, as the city grew from a small town to a bustling capital city. Homes in the Glebe Ottawa were hot property and people flocked to the neighbourhood.

Now one of the most sought-after neighbourhoods in the city, the Glebe has witnessed some incredible homes. The neighbourhood’s original character is still evident in the many historic homes for sale in the area, and the city has preserved many of these homes for the future.

The Glebe is also home to the oldest church in the city, St. James Catholic Church, which opened its doors to worshippers in 1819. The churches and other houses of worship in the area testify that religious diversity is a unique characteristic of the neighbourhood.

2. A Diverse Community

Many Glebe residents are immigrants, representing a wide range of cultures. Over 44 percent of the population is foreign-born. Along with the many churches, the neighbourhood is home to several different synagogues, temples, and mosques. 

Given how diverse the area is, it’s no surprise that the Glebe is a cultural hub with many festivals, galleries, and community centres.

3. Gorgeous Architecture

On top of everything else, the Glebe is also home to some beautiful homes. Several historic homes are for sale in the neighbourhood, and the architecture is stunning. 

If you’re interested in buying a condo, the Glebe has some new buildings with incredible architecture. These homes and buildings are a perfect blend of historic and contemporary architecture, and you’ll be proud to call them home.

4. Has Convenient Transportation

The Glebe is a great place to own a home with galore public transportation and bike routes. Car2Go has stationed several cars throughout the neighbourhood, making it a great place to rent a car on an as-needed basis. 

If you like the idea of getting around on a bicycle, the area has plenty of bike lanes, and there are bike paths that run throughout the city. Walking is also a great option because the neighbourhood is super walkable.

Conclusion

The Glebe is a great neighbourhood to consider if you’re looking to buy a home in the city. It’s one of the oldest and most culturally diverse neighbourhoods in the city, and it has a history that’s second to none. 

If you’re buying a home for the first time, you must take the time to get to know the neighbourhood and make sure that it’s a good fit for you.

Ottawa Mortgage Services provides mortgage agent services for first-time homebuyers, self-employed individuals, commercial clients, and more. We also help clients with refinancing, pre-approvals, and debt consolidation. If you’re a first-time home buyer in Ottawa, we can help you find the right mortgage in the right neighbourhood. Get in touch with us today and let us know how we can help!

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Updates on Canada’s First Time Home Buyer Incentive (2021)

Canada’s First Time Home Buyer Incentive (FTHBI) provides funding assistance and a down-payment assistance loan to middle-class homebuyers who have no experience availing their own property before. The program reduces monthly payments by decreasing the interest rate and extending the length of the mortgage. This allows first-time buyers to own homes with lower monthly payments than they could choose for themselves, and it also lowers property taxes by increasing the appraisal value.

The program is intended to level the playing field for first-time homeowners who could not otherwise afford it, allowing them to compete with other home buyers. It is expected to help at least 40,000 buyers over the coming years as it is designed to be long-lasting and sustainable.

The program was first launched in 2019 and has since garnered the support and inquiry of countless middle-class Canadians who are hoping to acquire their dream home without spending too much of their savings.

Eligibility

First Time Home Buyer Incentive was designed for first-time buyers who have no experience owning a residential property. Applicants must be 18 years of age or older and not be a member of a household that already owns a home in Canada.

They also need to be Canadian citizens or permanent residents. The property is expected to be purchased with funds from the applicant’s own resources or that of their spouse or common-law partner.

Buyers can be owner-occupiers or investors and must intend to occupy the property. It is expected that the applicants are not principal residence at the time of application too.

Keep in mind that applicants are not required to have a minimum amount of time in Canada, and they do not need to have been previously employed in Canada.

How To Apply

To apply for the program, the buyer must apply through a participating financial institution.

When applying, the buyer must provide the financial institution with several documents. These include:

  • A copy of the applicant’s birth certificate (if applicable),
  • A copy of their previous Canadian passport,
  • A copy of their previous Canadian citizenship certificate,
  • A copy of their previous Canadian Permanent Resident Card, or
  • Proof of Canadian citizenship or permanent residence.

Applicants must have their income tax returns certified by an authorized representative of the Canada Revenue Agency, Canada Border Services Agency, or Citizenship and Immigration Canada.

Some applicants may also require additional documentation such as a Social Insurance Number, and they must verify their identity with a valid Driver’s License or a piece of photo identification.

Another main requirement for the buyer, the first-time buyer’s spouse or common-law partner, and the first-time buyer’s co-applicant (if any) is to visit the financial institution together, as it is part of the primary application process.

The financial institution will fill out the necessary application forms to apply for the program, after which an application will be submitted to the local Canadian Mortgage and Housing Corporation office who will arrange for an appraisal.

Conclusion

Overall, these are just some of the most vital information about Canada’s First Time Home Buyer Incentive (FTHBI). If you happen to fit the eligibility criteria, feel free to inquire further about the other required paperwork. Not only will knowing them help you familiarize yourself with the appropriate deliverables, but you will also get a general idea of what to expect out of the process.

Be sure to know the essential details by heart, and you may just get that well-needed loan for your dream home in no time.

With that being said, if you are looking for the best mortgage specialist in Ottawa that would help you with your FTHBI, look no further than our expertise here at Ottawa Mortgage Services. We provide mortgage agent services for first-time homebuyers, self-employed individuals, and commercial clients. We also help with refinancing, pre-approvals, and debt consolidation. Contact us today and let us discuss all your available financing options.

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4 Things Every First-Time Home Buyer Needs to Know

If you are a first-time homebuyer in Ottawa, there are some things need to know before you find your new home. The real estate market in Ottawa is very active, and can be intimidating for any homebuyer. 

There are many misconceptions about the real estate market that need to be debunked. If you’re thinking about buying a home for yourself, here are some of the facts you need to get straight.

1. There Are a Myriad of Active Residential Listings in Ottawa

In today’s modern society, our knee-jerk reaction to buying homes is that “it’s expensive.” In Ottawa, this isn’t always the case. There are many affordable homes in the city that’s just a short 15-20 minute drive from the suburbs.

The best part? A majority of these listings can fall under $425,000, which is about 33 percent less than the average Ottawa home – listing at $639,000. While there has been a surge in prices over the last two years alone, there will always be a handful of affordable homes available for first time home-buyers.

2. The Value of Ottawa Homes Increases by $41,000

Home buying is more than just that. It is also an investment. If you’re just at the point in your life where you are getting out of student loans and building a savings fund, it’s only logical that you want to wait before you can get your bearings together.

The sad fact is, however, that the value of homes in Ottawa increases by at least $41,000 annually. This means that the longer you wait to buy, the higher the prices become when the time comes. Working with a mortgage agent can help you figure out the next financially wise step if you want to buy your home before this happens.

You may be intimidated by the fact that your parents could do all of these at roughly the same age you are now, but keep in mind that the economy has changed a lot since then. 

3. Your First Home Won’t Necessarily Be Your Last

Many people buy homes with the intention of living there forever. But as statistics go, people are becoming more and more inclined to reside in their homes for about 5-7 years before seeking other living arrangements.

Instead of planning for a “dream home,” people instead tend to think about how much they can afford instead. You might end up moving into a few houses before you can find one that perfectly fits your ever-changing lifestyle.

4. You Can Build Long-Term Wealth with Your Home

As mentioned earlier, home buying is an investment. Looking at all of your monthly costs, there is a lot to cover, from mortgage, utilities, insurance, and more. In cases like this, renting might be a better and easier option. However, you end up paying someone else’s mortgage and building their wealth rather than your own.

Mortgage payment is about building your own wealth and increasing the value of your home. With monthly mortgage payments, you can pay off the principal and make your home a more valuable asset.

Conclusion

Although the process can be intimidating for some, taking on the real estate market is not that difficult. As long as you bear in mind these important tips, you should be able to take on the home buying process with ease.

With a capable mortgage agent by your side, taking on real estate should be a breeze. At Ottawa Mortgage Services, we provide mortgage agent services for first-time homebuyers, self-employed individuals, and commercial clients. Consult with us today to learn more.

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What Should You Buy: A Starter or a Permanent House?

There is no better way to define success and stability than having a house of your own. Besides the shelter it provides, it is also a hard-earned investment that owners can be truly proud of. The tricky part of buying a home, apart from all the processes and requirements, is decision-making. Since the property is a big purchase, you have to think about your decisions well, including its long-term consequences. 

One of the most important decisions you have to make is whether or not you will buy a starter or a permanent home. If you are faced with this tough decision-making, let this article help you understand what they are and what you should choose. 

Starter or Permanent Home: What Is the Difference?

The main difference between a starter or a permanent home is how long you plan to stay in it. They may be the same house for the same purpose but might differ in structure and size. 

Starter homes are usually smaller in size and are often purchased by first-time homebuyers who are just starting. Some examples of starter homes are semi-detached or fully detached houses, condos, and townhouses. They are also the more affordable option. 

Permanent homes are houses that you see yourself living in for ten or more years. There is no clear definition of its look and size. However, since it is the house that usually accommodates a big family for a long time, it may contain more rooms than the starter homes. 

So, before you decide, think about how long you plan to live in that place you are eyeing. Weigh the pros and cons of the two as well. Here is a good comparison of the two. 

Why a Starter Home Can Be a Good Purchase

Anyone looking for an affordable and small house would benefit a lot from a starter home. Since it is more affordable, it also means that you would pay for a much lower down payment. Perhaps, you could also get a lower monthly price and finish paying it in a few years. 

Just like other investments, it also has its flaws, such as the following:

  • You have a growing family with changing needs.
  • You have to finish its payment should you decide to live somewhere bigger or in a different location or lose your source of income.

What to Keep in Mind Before Buying a Starter Home

If you think a starter home is what you would need in the next few years, here are some things to consider before you make your purchase:

  • The Cost of the Homes: Even if starter homes are not as expensive as permanent homes, they still require you to secure a mortgage. Make sure that the price you will be paying meets your budget. Looking for lenders who provide mortgage services and having your loan pre-approved would help you with your purchase.
  • The Features and Amenities: Since you will be paying less than a permanent house, expect some of its features might not fit the dream house you have. See if you are willing to stay in a home that does not have a yard or miss a half-bath before you decide. 

Conclusion

Whichever you choose, whether a starter home or a permanent home, the house you would get will be an investment. What you need to consider now are other factors, such as your priorities, budget, and plan for the future. Once decided, look for someone who can help you find a quality home that meets your needs. 

Ottawa Mortgage Services is an Ottawa-based mortgage agent that can help you find lenders allowing self-employed Canadians with good records to qualify for the lowest mortgage rates. Contact us to learn how we can help.