Deprecated: mysql_connect(): The mysql extension is deprecated and will be removed in the future: use mysqli or PDO instead in /home/a26f9f83/public_html/articles/includes/config.php on line 159
Unravelling The Real Estate Buying Process in Canada > NetSparsh - Viral Content you Love & Share

Unravelling The Real Estate Buying Process in Canada

If you're a foreign national thinking about investing in the real estate market in Canada here's a run down of the typical buying process you should expect to encounter together with a general explanation of mortgages available to assist with the purchase.

First things first though, you have to find your ideal property of course!

But let's assume you've done that with the help of a good estate agent and you're ready to move forward with an offer.

It's important to know that from the outset the entire process surrounding the buying and selling of real estate in Canada is a regulated process. This means the process should follow the basic format as described below and that you will be protected throughout by the rules governing the process and the actions of those involved in it.

Once you find your dream home in Canada you make a financial offer to purchase to the vendor - probably via your agent - which your estate agent is legally bound to submit to the vendor whether or not it matches the asking price. Negotiations proceed until a purchase price is agreed upon between you and the vendor, at which point both parties sign the 'Offer to Purchase' - also known as 'Agreement of Purchase & Sale'.

This is a preliminary contract and it is either 'firm' or 'conditional'

A conditional preliminary contract usually contains terms relating to the successful securing of finance to buy, or to the satisfactory completion of building surveys etc., and it only becomes firm when all the conditions have been met.

If you are using a mortgage to purchase your home it is essential to have this noted as one of the terms, because if you fail to secure your mortgage and the contract falls through you will want your deposit back!

A firm preliminary contract is not subject to any terms or conditions, if it is broken by the purchaser they lose their deposit, if it is broken by the vendor they may be subject to a financial penalty.

Your deposit will be required when signing the Offer to Purchase, and the contract will contain your completion date.

When the completion date is reached and all conditions for the fulfilment of the contract have been met, the remainder of the purchase price together with all fees will be payable.

Monies are paid to the vendor via the solicitor or notaire handling the legalities of the sale. At this point both the purchaser and the vendor sign the 'definitive contract' which is called 'Acte de Vente' in Quebec.

If purchasing in Quebec this final part of the sale is managed by a notaire who in this case is a government official - s/he is responsible for the conveyancing and as a result s/he represents both the purchaser and the vendor...it therefore makes sense to employ your own legal representative in Canada to make sure your best interests are served and protected throughout the process.

Fees you will likely incur on top of mortgage arrangement fees, legal and survey fees include provincial fees and land transfer taxes. Provincial fees are around CAD 100 depending on the province in which you're purchasing, and they are charged for transferring the title of the property etc. Land transfer taxes are again determined by each province and they are calculated as a set percentage of the purchase price.

If you are interested in securing a mortgage to fund your purchase it is interesting to note than depending on your country of origin and circumstances, there are a number of major financial institutions in Canada willing to lend to non-resident buyers.

The following is only meant to serve as a general guide to Canadian mortgages - it may not apply in every case.

Most Canadian mortgages are what's known as "full status" - a full status loan is where complete checks are made on the borrower's credit history and income.

To apply for such a mortgage you will have to have proof of income and outgoings. Such finance can be raised for the purchase of property, the renovation of real estate or for house construction purposes.

Generally a 35% deposit is required and the purchaser is also responsible for all legal fees involved in the arrangement and purchase process. 35% is just a guideline, some provinces require deposits of up to 50%, and in special circumstances a deposit lower than 35% may be acceptable.

Most mortgages are repayment over a maximum of 25 years with pay back due for completion before the purchaser's 70th birthday. Most lenders make life cover a further lending requirement.

When it comes to eligibility for a loan and size of a loan you need to know the following: -

- Eligibility is based on the applicant's current ability to fulfil the financial terms of the loan, it is not based on any potential rental income the applicant may generate from the property he is hoping to purchase with the mortgage.

- Taking the applicant's gross income into account, 40% should cover all existing outgoings and commitments AND the monthly repayments for the proposed new mortgage.

- If you're self employed then your income will be taken as the average of your last three years' net income.

- If you have existing rental and/or investment income this may be taken into consideration as well.

- Outgoings in this context are any current mortgage or rent you pay, any personal loans or credit card payments you have and any child support payments you have to make.

If your mortgage application is successful it will of course be secured on the property you're buying in Canada and not on any property you currently hold in which ever country you are a resident.

The mortgage company carry out a valuation of the property you're looking to buy to make sure it's worth the purchase price, and you'll probably end up paying any fees they incur making this valuation. Finance arrangement fees can sometimes be charged as well, they are usually 1% of the loan amount.

The money you borrow will be paid to the vendor via the solicitor or notaire responsible for the completion of the purchase contract and process.

That's it in a nutshell!

As stated though, the entire real estate purchase process and application for a mortgage will depend on personal circumstances.

Rhiannon Williamson is an experienced publisher who has produced articles for leading travel and tourism guides and financial magazines. Her specialist knowledge about both travel and finance gives her site Shelter Offshore the unique ability to literally cover every single aspect of moving & living abroad - including the often less discussed offshore tax advantages that can be available when leaving our homeland. Check out her website to find out how you can escape from the rat race, relocate overseas, and profit from your move!

In The News:

This RSS feed URL is deprecated, please update. New URLs can be found in the footers at https://news.google.com/news

Forbes

Why Real Estate Entrepreneurs Should Retire The Term 'House Flipper'
Forbes
Working in real estate for five years now, however, I have the learned the vast difference between reality and reality television. One big thing I've realized along the way is that the term “house flipper” is quite often a misnomer. In fact, I'd even ...


Forbes

How A New Agent Can Claim A Territory In Real Estate
Forbes
When one decides to start in real estate, their family and friends are typically ready to support them in their new venture by connecting with the new agent to help buy or sell. But, how does a new agent connect with locals in their area beyond friends ...

and more »

Forbes

Real Estate Agents Answer: What Should Buyers Look For In A Home?
Forbes
Suddenly, everyone seems to have an opinion on which features your new home needs to have. We thought we would take this debate to the experts to settle it once and for all. In that light, we asked real estate agents what buyers should look for in a home.


Forbes

The Fundamental Difference Between Single-Family And Commercial Real Estate Investing
Forbes
When it comes to real estate investing in single-family residences (SFRs) versus commercial real estate (CRE), there is a common misperception of grouping the two into the single broader category of "real estate investing." Grouping in this manner ...


Forbes

Three Ways Commercial Real Estate Lenders Are Going To Change The Way We Work
Forbes
When I first started working with large multifamily lenders, I was surprised how few of them made loans for apartments under 50 units. Since larger transaction volumes support larger fees, it makes sense that nearly all of the major real estate lenders ...


Group One Real Estate 9-22-2018
Idaho Statesman
No one covers what is happening in our community better than we do. And with a digital subscription, you'll never miss a local story. SIGN ME UP! Comments. Videos. SHARE. COPY LINK. A diamond heiress is selling her Tenino estate. It can be yours for ...


Charlotte Business Journal

Allen Tate real estate merges with Pittsburgh firm. Here's what it means for Charlotte
Charlotte Observer
Charlotte-based Allen Tate is merging with the Pittsburgh real estate firm Howard Hanna. The “partnership,” as the two companies describe the deal in a statement Thursday, makes the two the top residential real estate firm in Pennsylvania, Ohio, New ...
Allen Tate Cos. forms new partnership with large Pittsburgh-based real estate firmCharlotte Business Journal
Allen Tate Companies and Howard Hanna Real Estate Join ForcesVirginian-Pilot
Howard Hanna acquires Allen Tate Companies to form mid-Atlantic real estate giantInman.com

all 9 news articles »

SpaceCoastDaily.com

BREVARD REAL ESTATE WATCH: 7 Home-Selling Mistakes You Need To Avoid
SpaceCoastDaily.com
USING AN ODD LISTING PRICE: Buyers search real estate websites for price ranges, such as “homes between $250,000 – $300,000.” If you set an odd price to make your listing stand out, say $302,499, you may miss some of your best potential customers.


Odessa American

PGIM Real Estate hires Vincent Chew as portfolio manager
Odessa American
SINGAPORE--(BUSINESS WIRE)--Sep 20, 2018--Vincent Chew has joined PGIM Real Estate as an executive director and portfolio manager for PGIM Real Estate's core investment strategy in Asia. PGIM Real Estate is the real estate investment business of ...


mySanAntonio.com

USAA cutting 265 real estate jobs
mySanAntonio.com
San Antonio-based USAA said Thursday it will be eliminating about 265 jobs at its bank in mid-November. The job cuts will impact employees in its bank's real estate lending operations and its “Real Estate Rewards Network,” which supports USAA members ...
USAA plans to eliminate hundreds of jobs in real estate divisionSan Antonio Business Journal

all 14 news articles »
Google News

Sell Your California Home For Top Dollar

HOW TO SELL YOUR HOME FOR TOP DOLLAR1. Make your... Read More

Pricing your House to Sell

Most Sellers set their initial asking price at an amount... Read More

10 Important Tips to Successful Real Estate Investing

When it comes to investing, everybody has certain goals and... Read More

Curb Appeal

First, lets start with what it is. Curb appeal is... Read More

Why Do Realtors Advertise Your Home in Print,on the Radio, on Television, etc.?

Why Do Realtors Advertise Your Home in Print,on the Radio,... Read More

Real Estate Investing Myths That Steal Profits From Your Pocket

One of the things that distresses us about our industry... Read More

Home Not Selling In Todays Hot Market? Tips and Ideas to Help You Sell

So, your selling your home. Prepare yourself both physically and... Read More

How To Simplify Your Real Estate Buying/Selling Experience

Today's real estate consumer has a lot to consider during... Read More

Real Estate: A Strong Investment

Description: Even in uncertain economic times like these, history shows... Read More

Real Estate Investing Is A Better Gamble Than The Lottery

Real estate investing begins when you move to the starting... Read More

Home Equity ? Don?t Spend It on Risky Investments

The housing market has exploded in the last five years,... Read More

So, You Wanna Buy Pre-Foreclosures?

So you wanna buy pre-foreclosures? or at the courthouse steps?... Read More

Successful Property Letting And Management

Successful Property Letting And Management is not something that just... Read More

Buying To Let Top Ten Tips

Buying to let is considered a serious investment and should... Read More

Property Investing Secrets 5

Property Investing Secrets:How To Work With Agents And Get What... Read More

Boom or Bust

For those looking to invest in the real estate market?keep... Read More

Selling Your Home: The Power of a Great Sales Flyer

Even though its importance is often overlooked, a great sales... Read More

Conventional Financing For Wholesale Deals

This info is very important for both new and experienced... Read More

Oh No! Something has Happened in Florida

The Florida housing market has attracted many foreigners to invest... Read More

Real Estate Investing ? The First House Purchase

Real estate investing usually begins with the purchase of a... Read More

Miami Property Booming for Foreign Investors

Miami tourism is growing and so is the Miami property... Read More

Real Estate Marketing, Do You Use Direct Mail?

Prospecting for leads is by far the most difficult part... Read More

Quality of Life in Sussex County Delaware. Facts, Statistics, Observations and even opinions!

We Sussex Countians are fortunate in many ways as we... Read More

Real Estate Investing with No Cash and No Credit

Lots of folks think it can't be done.How in the... Read More

3 Mistakes to Absolutely Avoid in a 1031/TIC Exchange

We've all made bad decisions in the past. Don't you... Read More