The Who’s Who in Buying a Home

By Kyla Millette

When it comes to buying a new home, the task can feel overwhelming for many; not to mention if you’re an immigrant brand new to Canada and its real estate process. At times it can feel like getting your funds together was the easiest part! There’s a mountain of paperwork to be done, and you’ll be coordinating them with a number of different people. These people will all play a distinct role in finalizing the rewarding experience of buying a home. 

In this article, we’ll go over the who’s who of buying a home, the role each plays, and how to get the most out of the relationship. 

Appraisers

Typically, you need to have an independent appraisal of a house before making your offer to purchase. If the appraiser decides the house’s value is less than the asking price, you then have the opportunity to negotiate a new price. The appraisal will involve an unbiased assessment of the home and its property, an analysis of recent, similar sales in the neighborhood, and an evaluation of that area’s current real estate market. 

Home Inspector

You should always try to have a home inspected before you make a decision. An inspector will provide you with a detailed written report consisting of an analysis of how the house was built and whether it needs repairs. Inspectors can be found through your real estate representative or local professional associations. 

You also want to ensure the inspector has errors and omissions insurance in case the house ends up needing additional expensive repairs the inspector did not include in the report. If the home is particularly old, be sure the inspector checks for termites, lead paint, and asbestos. 

Insurance Broker

An insurance broker is responsible for handling all insurance, such as auto, life, and property. Lenders will typically insist you take out property insurance since your property is the security of your loan. The property insurance will also cover the replacement cost of your home. The insurance fee or premium will depend on how much the home is worth. 

Lenders sometimes suggest that you take out mortgage life insurance which pays off your mortgage if you or your spouse dies. This insurance is usually available through your lender and is added to the regular mortgage payments. 

Lawyer/Notary

Your lawyer is there to protect your interests when buying a new home. They search the title to ensure there are no liens or outstanding work orders and also check the offer to purchase. Your lawyer or notary is essentially responsible for all closing arrangements.

Lenders

Once you’ve reached a decision on a home and want to make an offer to purchase, it’s time to find a lender to grant you the funds. Lenders can be banks, trust companies, credit unions, pension funds, finance companies, and insurance companies.

You may want to start talking to lenders or brokers about what type of mortgage you can afford before looking for a home. 

Mortgage Broker

Mortgage brokers exist to find you lenders and are generally independent. Most of the time, brokers receive their fee from the lender of about one to two percent of the mortgage value. However, it is common for brokers to charge you a fee directly, especially if you have a poor credit history. 

Real Estate Representatives

All real estate representatives should have a provincial license and have legal obligations while agreeing to ethical standards. A realtor can be seen as a real estate salesperson, agent, or broker and must be a member of the Canadian Real Estate Association (CREA).  

The role of a real estate representative is to know the housing market and guide you through the entire process of purchasing a new home. 

Have more questions about all things real estate? Here at Howzit, we partner with exceptional real estate professionals that can give you more insight into the Canadian housing market and how to land the home of your dreams.

Did these points raise even more questions? Let’s help you get more answers – reach out to us to chat!
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