Practice your mortgage…
What exactly do I mean by that? Well, if you’re a first-time buyer and just beginning to explore the housing market, chances are you’re currently renting or living with family, and very likely paying less than you will be going into your new home. For this reason, I strongly suggest you start getting used to your new mortgage payments sooner than later.
Let’s suppose you’re paying $1,600.00 monthly rent and planning on buying a home for $500,000.00 with a 10% down payment plus typical maintenance fees and taxes your new monthly payment would be approx. $2,600.00. I’d encourage you to start paying yourself the difference between your current rent and your new monthly payment, then deposit that $1,000.00 into an on-line savings account.
Why? For starters you’ll get used to the amount that will eventually be your real housing payment. If that isn’t compelling enough in itself, consider that you’re also be putting away extra money to help with your new purchase down payment, pay your closing costs or treat yourself to something special.
The Sooner you start “practicing your mortgage”, the better…
Already a home owner and looking to buy up? The same principle applies. Once you’ve determined the monthly mortgage payment on your new home, increase your existing mortgage payment by that amount. You’ll be better prepared for the realty of your new payment and paying down your mortgage faster in the meantime.
Any of the 2,500 Dominion Lending Centers mortgage professionals across Canada are happy to help you work through these and other mortgage related scenarios and tips, so please get in touch.