You're on your way to getting the keys to your first home. There are several individuals who will help you on your journey to becoming a new homeowner. From your real estate agent to the mortgage lender, these seven key players in the home buying process each have a unique role to play. Here's who you can expect to meet during the process and which individual will be your go-to as you get closer to owning your new home
1. Start with a real estate agent
Your real estate agent represents you during the home buying process. During your initial house-hunting process, it may seem like any real estate agent will be a good fit for you, as long as they show you the homes that you're interested in. However, once you decide to proceed with a home purchase, your real estate agent is vital for keeping communications between you and the seller clear and legal, as well as protecting you from any issues that can pop up with finances or the home inspection. You'll spend a lot of time with your agent, so it's important to use someone you trust and that respects what's important to you. Remember, a real estate agent works for you, so if the relationship isn't working well, it's time to find a new agent.
2. Your real estate lawyer is the best person for all legal matters
Your home is the biggest financial purchase you'll make, and it's crucial that all of the paperwork, insurance, and property taxes are done correctly to avoid legal issues down the road. A real estate lawyer will review the Agreement of Purchase and any other accompanying legal documents to ensure there are no claims against the property. Your lawyer will also arrange for title insurance, check that property taxes are up to date, and see that all legal and financial conditions are met.
3. Mortgage advisors help with the financial side
A mortgage advisor is another important key player you'll encounter on your journey to homeownership. A mortgage advisor helps customers get financing for their new home. Your mortgage advisor might work for a bank or be an independent broker who can provide financing options from multiple banks or mortgage lenders.
Meeting with a bank mortgage advisor is easy and convenient since you can visit your local branch or arrange to meet a mobile mortgage advisor at a location of your choosing. For example, Scotiabank's Home Financing Advisors are available to connect the way you want, 24/7, and will customize a mortgage to fit your needs, and you have the comfort of knowing your home purchase will be funded by Scotiabank.
4. Don't skip the home inspector
It might be tempting to save a few hundred dollars and skip the home inspection process, especially if the home appears in great condition. In fact, in a hot market, there might not be enough time for an inspection, or you might feel pressured to waive the inspection to have your offer accepted. Don't skip the home inspection, no matter how new the home is or how fast the market is.
Skipping the home inspection can pose many safety and financial risks for buyers, such as mould behind the walls or a roof that needs extensive repair. Your home inspector is trained to not only identify issues on the outside of the home but also the interior systems that can be harder to check, such as the electrical, heating, air conditioning, ventilation, plumbing, and insulation. If the home inspector does find issues with your home, you will then legally be able to ask the sellers to fix the issues or to cancel the sale without any repercussions.
5. The appraiser ensures you aren't overpaying
In a seller's market, home prices can be set high due to the demand of buyers. Before the bank or lender will fund your home purchase, they'll order an appraisal to validate the lending value. An appraiser ensures that the house is set at a fair value based on the condition of the home and the comparable home sales nearby. If the appraiser deems the home's value under what your purchase price is, you can then ask the seller to come down on price or choose to not buy the home. However, if the home had many strong offers on it, you might have to pay over the appraisal value if it's the home you want and need to be competitive against other offers. Whether you can pay over the appraisal value will depend on your unique financial situation and lender's financing rules.
6. The title company checks for a clean title
The title company works to protect both the lender and buyer. Their job is to ensure there are no issues, such as overdue taxes, zoning restrictions, or liens against the property. If the title is clean, then the lender can proceed with title insurance, which is purchased by the homeowner to protect the lender financially against any legal claims against the title. Having this confirmation that the title is clean could be a requirement to getting a mortgage. This is something you will usually work with your lawyer to obtain.
7. Protect your new home with home insurance
Homeowner's insurance will protect you and your home for minor and large emergencies alike (and is sometimes a requirement to securing your mortgage). Your homeowner's insurance can cover you for annoying smaller issues like a broken water heater. It will also protect you against more substantial and expensive issues, like if you have a fire or your roof collapses. It's a good idea to get a few different home insurance quotes to make sure you find the right coverage for your home needs and budget.
Ready to learn about your financing options?
Ready to meet these seven key players in the home buying process and make that dream home a reality? A Scotiabank Home Financing Advisor is a great place to start. See what rates you qualify for, how much home you can afford with your current income and credit score, and learn about the benefits of Scotiabank’s flexible borrowing solution the Scotia Total Equity® Plan (STEP).