Introduction

The home-buying process can be overwhelming, especially for first-time buyers and in this 3 part series, what I’m calling First Time Buyers Bootcamp, we are going to look first of all This section will break down the home-buying process from start to finish,  give you an overview of what to expect,  and then in our second video we are going to go over some specific house hunting tips and trick, and then our final video will wrap up everything by talking about navigating negotiations and closings. I’m Lisa Salt with RE/MAX Vernon Salt Fowler and I’m a Realtor in the North Okanagan / Shuswap for over 30 years, and we have specialists in our group who are specialists in dealing with First Time Buyers. Let’s start by sharing some of the wisdom and experience we have gained with you over these many years, starting with Step number one which is the preapproval.

1. Pre-Approval – pre approved mortgage.

• Definition: Pre-approval is a lender's estimate of how much you can borrow based on your current financial situation.
• Process: Find a lender.  Most people go to their banks.  My bank knows me, they know my situation.  I would caution against this actually, and get a mortgage broker, because brokers are specialists.  Your banker may be great at banking, however you want someone who does nothing else but get the best rates on the best mortgages, they will search every lender, your bank only deals with one – their bank.  What if your bank doesn’t have the best rate or the best terms?  Maybe they do, however we have seen more deals go sideways from people wanting to deal with their bank.  We can hook you up if you want, however I would highly recommend dealing with a mortgage specialist. 
• Preapproval, a firm preapproval, not subject to everyting under the sun.  Gather financial documents such as pay stubs, tax returns, and bank statements.
• Contact lenders to compare pre-approval offers.
• Choose a lender that offers favorable terms and interest rates.
• Benefits:
• Helps you understand your budget.
• Strengthens your offer by showing sellers you are a serious buyer.
• Speeds up the closing process once you find a home.
• Avoids the heartbreak of finding out you can’t afford that home you absolutely love

2. Choose an Agent and Searching for a Home

• Research: Identify neighborhoods that meet your lifestyle needs, considering factors like schools, commute times, and amenities.  Do your market education, that’s what we call it ;). Go out and look at various types of properties.  How many times have people said they don’t want a townhouse and end up buying one. Look in and around your price range. 
• Use Online Tools: Websites like Realtor.ca, SaltFowler.com of course, offer listings with photos, price histories, and neighborhood information.  If being close to amenities is important, look at the Walk Score, things like that. 
• Attend Open Houses: Gain insight into different home styles and layouts, and understand what you value in a home.  If you’ve chosen your Realtor, get cards to give out
• Once financing is approved and you’re doing your due diligence on all these things, you’re going to find a property you want.  Now the fun part.  Also stressful part -

3. Making an Offer

• Determine Offer Price: Consider the home's market value, condition, and comparable sales in the area.  Tax assessment.  Appraisal. 
• Include Contingencies: Common contingencies include financing, inspection, and appraisal contingencies.
• Negotiation: Be prepared to negotiate with the seller on price, closing costs, and other terms.

4. Home Inspection

• Purpose: Identify any issues with the property, such as structural problems, outdated systems, or needed repairs.
• Hiring an Inspector: Choose a licensed and experienced inspector. Attend the inspection to ask questions and learn about the home's maintenance needs.

5. Appraisal

• Definition: An appraisal is an independent assessment of a property's value.
• Importance: Ensures the lender that the property is worth the loan amount.
• Outcomes: If the appraisal is lower than the offer, you may need to renegotiate the price or provide a larger down payment.

6. Closing

• Final Walkthrough: Conduct a walkthrough to ensure the property is in the agreed-upon condition.
• Signing Documents: Review and sign closing documents, including the mortgage agreement, with the lawyer or notary, in BC you can use a notary. 
• Closing Costs: Be prepared to pay fees for loan processing, title insurance, and other services and potentila taxes,  in BC you have the British C Transfer tax (first time buyers are usually exempt, but there are restricitons on that)
• Transfer of Ownership, on possession date, Once all documents are signed and funds are transferred, you receive the keys to your new home.
• Hope for but do not expect a clean house. 

The Importance of Credit Scores and Financial Readiness

• Credit Score Impact:
• A higher credit score can secure a lower interest rate, saving thousands over the life of a loan.
• Check your credit report for errors and pay down debts to improve your score.
• Financial Readiness:
• Save for a down payment, typically 5-20% of the home's price.
• Establish an emergency fund to cover unexpected home repairs and maintenance.
• Watch our video about FIRST TIME Home Buyer's Guide: How to Raise a DOWN PAYMENT in BC | 2024 Strategies & Tips