This influx represents one of the highest rates per population of any country in the world.

These newcomers will be looking to navigate the dream of owning a home in Canada. According to REALTOR.ca insights, approximately 40% of individuals currently searching for homes are first-time buyers.

This article lays out the three significant steps to help you become prepared about the purchasing a home in 2024, including:

• Planning out your needs and what you can afford;
• Arranging your finances and mortgage; and
• Selecting a real estate agent

Plan the Requirements of Your First Home and What You Can Afford in 2024

What do you need in a first home?

Homes come in all shapes and sizes, in different neighbourhoods, and with various amenities. Before you even look at potential homes, you need to decide what’s important to you. This is especially true if you’re buying a home with a partner. It’s better to understand each other’s needs and wants now rather than later on in the process. For example, the neighbourhood and school district may be vital if you want or already have children and want to live in a neighbourhood with great schools.

What kind of first home can you reasonably afford?

You should also consider what you can afford when contemplating your needs and wants. You may want 3,000 square feet of space. But such a large home is out of reach for most first-time homebuyers. Areas with high-ranking school districts are also expensive.

Even if you can get an enormous mortgage to purchase the most expensive house available to you, it doesn’t mean you should. A sizeable monthly mortgage payment can hurt your financial and mental well-being in the long term. The Canada Mortgage and Housing Corporation recommends keeping your total housing payment (this includes taxes, maintenance, and mortgage) under 35% of your gross household income.

Arrange Your Finances and Mortgage for Your First Home

Are you financially ready to purchase your first home in 2024?

Buying your first home requires financial readiness. At this point, you’ve likely saved for a downpayment. But are you ready for closing costs such as legal fees and home inspection costs? These costs can amount to 2 – 4% of your purchase price. Further, once you purchase the home, are you ready for property taxes and maintenance expenses on top of your monthly mortgage payments?

It’s also important to understand what tools the Canadian government provides to first-time homebuyers. These tools generally make it easier for first-time homebuyers to make their purchase.

What is your credit score?

The next step is to review your credit score, which determines whether you’re qualified mortgage. It’s handy to find services that can help track your credit score. Many banks offer free credit score estimates without impacting it.

If your credit is on the low side, it’s essential to bring it up. This isn’t something you can do overnight. Raising your score may even delay your first home purchase. But a better credit score can provide you with better mortgage rates and more financial flexibility. If you’re purchasing your first home with a partner, note that lenders consider both of your scores.

How to find a mortgage for your first home

Your mortgage is commonly the largest loan you’ll take out in your lifetime. Therefore, it’s essential to shop for the best one. You’ll likely speak with two types of people in this process: a mortgage lender and/or a mortgage broker.

• Mortgage lenders are most commonly your large banks or credit unions. They lend money directly to you.
• Mortgage brokers don’t directly lend to you but arrange a transaction to help you find a lender. Brokers have access to many lenders beyond the big banks and credit unions — generally referred to as “A Lenders”. They can introduce you to B and C lenders who may be more lenient if you have a less-than-pristine credit score.

Previously this process involved visiting numerous banks and mortgage broker offices. But post COVID-19, this process is more commonly done over video conferencing. When the deal is settled, some lenders or brokers may still require you to visit in person to sign the paperwork.

The interest rate on your mortgage is the most crucial characteristic, but also consider aspects such as:

• Do I need to purchase mortgage insurance?
• What fees do I need to pay if I break the mortgage?
• Are there any penalties if I refinance my home?

Getting your mortgage pre-approved before you begin to look at properties is essential but optional. A pre-approved mortgage can provide certainty in how much you can bid on a house when you find the one.

Find a Real Estate Agent

Buying a home isn’t easy. It’s a lengthy process with complicated steps and procedures. Luckily, real estate agents are here to help. A realtor can match your needs and wants with what you can afford. They can also advise what to look out for in a first home — things you’ve never anticipated. They can address your concerns about the current market conditions, how certain neighbourhoods are, and what red flags to look out for and provide referrals to real estate lawyers, home inspectors, and other professionals part of the home buying process.

A REALTOR® can also do a lot of the in-person work for you during this COVID-era. Suppose you’re afraid of attending a home showing. In that case, many agents may be happy to visit the property on your behalf and show it to you via ZOOM, Facetime, or similar applications.

Once you’re ready to close on your deal, a real estate advisor can help prepare your offer package. This includes your offer price, pre-approval letter, proof of funds for the down payment, and terms and conditions.

It’s also important that you meet with several real estate agents before selecting the one you want to work with. Hiring an agent is similar to hiring an employee. You’ll want to meet with multiple agents and ask questions to understand their credentials. Online reviews are also a great way to differentiate between agents as reviews are written by real clients that have had a full experience working with the prospective agent you are interviewing.

Buying your first home is a complicated and exciting process — especially in 2024. It’s important to plan out what you can afford and what amenities and features that you and your partner need in a home. Arranging your finances and mortgage and finding an excellent real estate agent are also critical to making this process as smooth as possible and turning your homeownership dream into reality.

The post Three Steps to Purchasing Your First Home in 2024 first appeared on RankMyAgent - Trusted resource about Buying, Selling and Renting.

Snelgrove

Crime rates: 26% lower than Brampton average
Real estate prices: 12% higher than Brampton average
School rating: 73.3/100
Overall Livability Score: 87/100

Snelgrove lies on the border of Brampton and Caledon. The neighbourhood has a variety of grocery stores and plazas that are highly accessible. There are numerous parks here such as the Conservation Drive Park and Heart Lake Conservation Park that are perfect for children to play outdoors. Snelgrove is also near Highway 410 which makes it convenient for families to travel outside the town. While the real estate prices are higher, there are mainly two-storey detached homes that are spacious and surrounded by nature.

Northgate

Crime rates: 13% higher than Brampton average
Real estate prices: 25% lower than Brampton average
School rating: 67.8/100
Overall Livability Score: 85/100

Northgate is located in east central Brampton and is considered an older neighbourhood in the city. However, it has a diverse combination of stores, services, and amenities that make it easy to run errands. The average real estate price here is cheaper than the Brampton average because it consists of housing such as detached, semi-detached, and townhouses. This allows families to choose whichever housing option they feel is the perfect fit for them in terms of size and budget. Northgate also contains 10 outdoor parks and recreation centres that are all ideal for families with children.

Westgate

Crime rates: 1% higher than Brampton average
Real estate prices: 12% lower than Brampton average
School rating: 68.3/100
Overall Livability Score: 85/100

The average price of a single detached house in Westgate is $1.06 million, 13% lower than the GTA average. Single detached homes make up most of the housing in Westgate with some townhouses as well. This neighbourhood is quiet and family-friendly with lots of nature and open spaces. There is also the Bramalea City Centre shopping mall that is under 10 minutes away by car and is one of the largest shopping malls in Canada with over 300 outlets.

Heart Lake East

Crime rates: Equal to Brampton average
Real estate prices: 11% lower than Brampton average
School rating: 65.8/100
Overall Livability Score: 85/100

Although the school rating is lower than the previous neighbourhoods, Heart Lake East consists of 7 public schools and 6 Catholic schools that give families a variety of options to choose from. The highest ranked school is St Agnes Separate School with an 87% proficiency. Heart Lake East is also near the Heart Lake Town Centre and the Trinity Common Mall. The 9 parks in this neighbourhood provide families with children an open area with lots of green space.

Brampton West

Crime rates: 100% lower than Brampton average
Real estate prices: 20% lower than Brampton average
School rating: 58/100
Overall Livability Score: 84/100

Brampton West is right next to downtown Brampton, making it accessible to many businesses and ancient buildings. There is also a nearby GO train that can take residents to Downtown Toronto in about 40 minutes. A single detached home is typically priced at $945,000, 23% lower than the average price in GTA. The diverse population makes Brampton West have a high livability score with a mix of restaurants and shops.

Madoc

Crime rates: 18% higher than Brampton average
Real estate prices: 28% lower than Brampton average
School rating: 57/100
Overall Livability Score: 84/100

Madoc is an older neighbourhood that is west of Highway 410, allowing residents to reach Downtown Toronto in 35 minutes by car. The housing contains older detached and semi-detached homes compared to other parts of Brampton, but it still has a mix with townhouses and apartments as well. Restaurants in Madoc are also known to be very diverse with ethnic cuisine. The area has 12 parks scattered throughout, including one that can accommodate ice-skating.

Fletcher’s Meadow

Crime rates: 11% higher than Brampton average
Real estate prices: 3% lower than Brampton average
School rating: 64.3/100
Overall Livability Score: 84/100

This neighbourhood is north-west of Brampton with a 40,000 population. Rose Theatre is a popular venue for shows that are scheduled throughout the year. Outside the Rose Theatre is Garden Square where there are daily shows including concerts and movie nights. Housing styles available include detached, semi-detached, and townhouses. The average school rating may not be the highest, but Ray Lawson is the highest ranked school in the neighbourhood with an 83% proficiency.

Southgate

Crime rates: 23% higher than Brampton average
Real estate prices: 33% lower than Brampton average
School rating: 66.6/100
Overall Livability Score: 83/100

Southgate is in southeast Brampton and is one of the older neighbourhoods. However, it is a convenient location due to its closeness to Bramalea GO and Bramalea City Centre. There is a large variety of housing options here that are all below the average price of homes in the GTA. Single detached homes are $965,000 and semi detached homes are $850,000. The downside to this neighbourhood is that the streets become extremely busy during rush hour with a lot of traffic.

Brampton East

Crime rates: 14% higher than Brampton average
Real estate prices: 15% lower than Brampton average
School rating: 58.6/100
Overall Livability Score: 83/100

The main advantage of Brampton East is that it is a quiet neighbourhood while also close to several amenities. It has single detached homes that are $1 million with decent sized lots. Housing styles include a mix of detached, semi-detached, townhouses, low-rise, and high-rise apartments. The West Humber River Valley is a recreation trail that is a popular destination for residents to enjoy some time in nature. Meadowland Park and Peel Village Park are also open green spaces that have sports fields and playgrounds for children.

Northwest Sandalwood Parkway

Crime rates: 5% lower than Brampton average
Real estate prices: 4% lower than Brampton average
School rating: 67.2/100
Overall Livability Score: 83/100

This neighbourhood is relatively newer with higher real estate prices compared to Brampton East and is located near Snelgrove. A single detached home is priced at $1.13 million, 7% lower than the average price in the GTA. Although this is a newer community and it is still evolving, there are restaurants that feature diverse cuisines. This neighbourhood is perfect for families who prefer newer homes, but also a quiet area with well established neighbouring regions such as Snelgrove and Fletcher’s Meadow.

The post Best 10 Neighbourhoods in Brampton for Families first appeared on RankMyAgent - Trusted resource about Buying, Selling and Renting.

With so many neighbourhoods in Toronto and such a variety of differences between them, it may be hard for new families  with children to choose where to settle down.

For young families, entertainment and activities, parks, top rated schools, transportation, the price of real estate, and much more all play a role in where to buy a home.

As a new immigrant, you may be starting to wonder what are some of the top neighbourhoods for families with children to put on your radar. This article is for you and lists 10 Toronto neighbourhoods to consider to settle down to.

Our Top 11 Toronto Neighbourhoods family friendly neighbourhoods include:

• North Toronto
• Branbury-Donmills
• Deer Park
• Riverdale
• Milliken
• The Beaches
• Rocensvalles
• Runnymede-Bloor
• East Lansing
• Etobicoke- West Mall
• Humber Valley Village

North Toronto

Avg Price of Condo (TREB Q4 2022): $728,000 (Yonge-Eglinton)

School rating score: 37.1/100

North Toronto includes the Yonge-Eglinton intersection and the area surrounding it. The neighbourhood was named “best Toronto neighbourhood to live in” among the 140 neighbourhoods in Toronto by Toronto Life. And North Toronto upholds its reputation with its easy subway access, variety of strong educational institutions, numerous parks, and much more. While the $2.4 million detached homes in the area may seem unaffordable for new families, Yonge-Eglinton offers many family-oriented, entry-level condos at a much lower price.

Branbury-Don Mills

Avg Price of Detached home (Q4 2022): $2,755,000

Avg Price of Condo (Q4 2022): $718,000

School rating score: 88.6/100

Though the price of a detached home averages $2.7 million in the Banbury-Don Mills area, it’s similar to North Toronto in the sense that young families can still move into the area with a cheaper, family-oriented condo. The neighbourhood has CF Shops at Don Mill at the centre, which is filled with amazing retailers and restaurants. Fairview mall is also close by and other activities, such as the Aga Khan Museum, aren’t too far away. The area provides a city-suburb feel and is close to the highway, making morning commutes to work that much easier.

Deer Park

Avg Price of Detached home (Q4 2022): $3,137,000 (Yonge-St. Clair)

Avg Price of Condo (Q4 2022): $1,379,000 (Yonge-St. Clair)

School rating score: 94.3/100

Yonge-St. Clair is a busy intersection filled with shopping, entertainment, and businesses. There are a variety of older detached houses, newer townhouses, and everything in between. The area has great schools, with the prestigious Upper Canada College right in the neighbourhood.  David A. Balfour Park and Oriole Park provide some much needed green space in this midtown concrete jungle. David A. Balfour Park alone has over 20 hectares of space and features a flower garden, the Rosehill reservoir, and a waterfall.

Riverdale

Avg Price of Semi-Detached home (Q4 2022): $1,691,000

Avg Price of Condo (Q4 2022): N/A

School rating score: 87.1/100

North Riverdale is a highly desirable neighbourhood in Toronto due to its proximity to the downtown core and to expressways, its variety of green spaces, and its beautiful Victorian-style homes. One of its most notable spaces is Riverdale park which has steep hills for tobogganing and an outdoor pool. North Riverdale is also home to Greektown, which hosts the annual Taste of Danforth. $1.69 million for a semi-detached home is a high price, but an alternative is South Riverdale, only steps away, where detached prices averaged $1.8 million and semi-detached prices averaged $1.3 million.

We asked Karolina Armstrong, from The Armstrong Team, to provide us her unique insights about Riverdale as she has been living in the neighbourhood for over a decade.

1) What makes Riverdale special? 

Karolina: “It beautifully walkable! And its filled with activities for children- There is every imaginable sport, tutoring, and art class within walking distance. It’s incredible. You can wake up, walk the kids to school. Grab a coffee. Drop off library books, pick up veggies for dinner, hop on the treadmill, take the kids to a park after school, see a show, and grab a bottle of wine…….all within walking distance. The greenery and local atmosphere is special here, there is a lot of charm.”

2) Why would you want to raise a family in this chosen neighborhood?

Karolina: “I would and I have! We’ve been living in this neighbourhood for over 10 years and moved here when expecting. It has great schools, and so many places to explore with little ones. I didn’t realize how much green space was here and as soon as we started to explore as a family, it seemed that we found a new park every time we walked around. Everything is walking distance, so you don’t have to hop in your car every time you need anything and you feel a great sense of community walking around. The homes are full of character and you can feel the history in them.”

3) Tell us about some  community events that happen that you want to highlight?

Karolina “Numerous events at Withrow Park year-round! Ice skating in the winter, Farmer’s Market in the summer, outdoor theatre in the summer! Did you know that you can rent out the fire pits here and have an outdoor campfire with friends and family? A perfect local birthday idea for kids and adults! Withrow Park is the place families converge.”

4) Price trends in the neighbourhood?

Karolina: “When houses come on the market here, they don’t last. It’s a highly desirable neighbourbood with great schools. With the limited inventory in this pocket, bidding wars have been taking place for years.”

Milliken

Avg Price of Detached home (Q4 2022): $1,341,000

Avg Price of Condo (Q4 2022): $604,000

School rating score: 42.9/100

If you’re looking for more affordable real estate prices, Milliken may be the place for you. It’s quite far from the downtown core and a bit of a drive just to hit the highway, but the average price of detached homes here are half the price of many midtown and downtown areas. Milliken also has many reputable schools and a lot of ethnic diversity. There are also great restaurant options, especially for East- and Southeast-Asian cuisine.

The Beaches

Avg Price of Detached home (Q4 2022): $2,033,000

Avg Price of Condo (Q4 2022): $938,000

School rating score: 55.7/100

The Beaches features beautiful boardwalks and easy access to the Gardiner and Lakeshore expressways. Accessing the downtown core is only one streetcar away. The area has many annual events such as the Christmas Tree and Menorah lighting festival, the annual jazz festival, and much more. Although the average home price is high, the price is brought up by many of the expensive homes along the boardwalk. Properties not along the boardwalk are likely more affordable.

Roncesvalles

Avg Price of Detached home (Q4 2022): $2,053,000

Avg Price of Condo (Q4 2022): $868,000

School rating score: 15.0/100

Roncesvalles is a convenient location due to its closeness to the downtown core, High Park, and the Toronto waterfront. High Park is only steps away and has children’s playgrounds and a small zoo. Other parks in the area include Charles G. Williams and Sorauren park. While Roncesvalles didn’t score well on the Toronto Life school rating, it’s partially due to schools clustering in the adjacent High Park-Swansea neighbourhood, which had a school rating of 32.1. Roncesvalles may be the better choice than its neighbour, however, as High Park-Swansea detached homes average $2.4 million.

Runnymede-Bloor

Avg Price of Detached home (Q4 2022): $1,332,000

Avg Price of Condo (Q4 2022): N/A

School rating score: 73.6/100

Runnymede-Bloor West Village is north-west of High Park and is walking distance to the popular green space. The area is a popular shopping and restaurant district with plenty of bakeries, delicatessens, specialty food shops, cafes, and much more. Similar to Roncesvalles, it’s very close to the downtown core, but as an added bonus, Runnymede-Bloor is also close to the Runnymede and Jane subway stations. Again, though the area scores low on its Toronto Life school rating, it’s partially due to schools clustering in the adjacent High-Park Swansea neighbourhood.

East Lansing

Avg Price of Detached home (Q4 2022): $ 2 081, 000

Avg Price of Condo (Q4 2022): 671 K

School rating score:

Lansing, positioned along the Yonge Street corridor, is conveniently close to the former North York City Hall and close to the sheppard subway line. Lansing is also known for its excellent amenities. In addition to the North York Civic Centre and the North York Central Library, which are both located in the neighborhood, Lansing is home to a variety of parks, schools, and community centers. For those who enjoy outdoor activities, Earl Bales Park is a popular destination for hiking, biking, and skiing, while the nearby Don River Valley offers even more opportunities for outings with families.

The Dave Elfassy Team. winners from our Top 50 Teams in Canada in 2022, shared some insights for families interested in moving to East Lansing:

1) What makes East Lansing special? 

Dave Elfassy Team: There are great parks, Mel Lastman square is very close by and large lots for growing families.

2) Why would you want to raise a family in this chosen neighborhood?

Dave Elfassy Team: Raising a family in an area with lots of activities to do with the kids, highly rated schools, and a neighborhood with a very high safety rating and low crime rate.

3) Are there community events that happen that you want to highlight?

Dave Elfassy Team: There’s lots. Usually, there are weekly events at Mel Lastman Square to enjoy.

4) Price trends in the neighbourhood?

Dave Elfassy Team: Prices have remained resilient in this neighborhood even with the latest downturn. It’s so close to transit, hubs, and many other activities. This area will always be in demand and prices will stay high.

Etobicoke West Mall

Avg Price of Detached home (Q4 2022): $1,106,000

Avg Price of Condo (Q4 2022): $559,000

School rating score: 30.7/100

Etobicoke West Mall is a great area that’s a lot more affordable than most of Toronto. It’s just west of highway 427 and has TTC busses that take you straight to the Kipling subway station. Just south is CF Sherway gardens as well as Cloverdale Mall on the other side of the 427. The West and East Mall parks are close by, as well. Each park has a tennis court, baseball diamond, and children’s playground, and the West Mall park has an additional ice rink and outdoor swimming pool.

Humber Valley Village

Avg Price of Detached home (Q4 2022): $2,098,000

Avg Price of Condo (Q4 2022): $650,000

School rating score: 14.3/100

Stationed right by Humber River, Humber Valley Village has a huge network of parks along the waterway. The neighbourhood is also 20 minutes away from the downtown core and 10 minutes away from Pearson airport. A short TTC ride can get you to the subway line if that’s your prefered method of transportation, and the nearby golf courses and shopping centres make for perfect weekend activities. Similar to other expensive areas, a family condo may be better than a detached home if you choose to settle in Humber Valley.

The post Top 11 Best Family-Friendly Neighbourhoods in Toronto to Move Into first appeared on RankMyAgent - Trusted resource about Buying, Selling and Renting.

After more than two years living in a pandemic world, we all got used to spending more time at home, many times surrounded by our family, so how can we make this day special? Especially when sharing tight living quarters.

There are, of course, financial and ecological perks to shrinking the square footage of your home, but what do you do when you can’t shrink the number of occupants?

Juggling multiple schedules, maintaining well-treaded, multi-use spaces, and organizing become top-tier tasks for families. Having well-delimited areas became essential during the pandemic. A home office to work quietly and an entertainment room where you can have fun with your family can make spending so much time together easier. So that is why we prepared a few tips to complete this daunting task quickly and without additional stress.

Everything has a home. This tried-and-true tip has been mentioned time and time again, but it is especially important in a smaller space. Make sure that every item in your home serves its purpose and has a place to live where it can be tucked away when it’s not in use. Channel your inner HGTV guru and hit up Home Depot, Home Sense, Ikea or Home Outfitters and find some cute — and practical — storage units that will work in your space, and don’t be afraid to make labels!

The hardest part about this tip — and I think we all know it well — is to actually follow through and put things away when we’re done using them. When living in a small space, especially with other people, things hanging out on surfaces will instantly make your home look more cramped and more cluttered. Tucking them away into their respective drawers or cupboards after use will have the place looking more put-together and reduce some of those stress levels, making clean ups more efficient.

When eyeing up your space, it’s important to ask yourself if all of the items in your home serve a purpose and if not, ditch the clutter and consider downsizing. Listen to Marie Kondo and her art of Tidying Up. If the item does not bring you joy or serve any real purpose in your space, it may be time to part ways with it. 

Use space wisely. Families living in smaller spaces may have to break away from the intended design of the space and get a bit creative. What I mean is who says that the master suite has to be for the adults? Why not put the kids in there? They can share the space, plus it can double as a playroom and keep their toys from spilling out into the rest of the living space.

You can also think of how you can use curtains and bookshelves as room dividers to better create designated spaces to serve specific purposes. Don’t have a closet, for instance? Use a cube shelf from Ikea as a divider and use a few free-standing rolling racks behind to create a makeshift wardrobe. Those cube shelves work wonderfully because you can store items on both sides.

One way to create the illusion of more space is to paint your walls white. Not only is this currently in fashion but it allows the light to add extra square footage to your space, well at least make it look like that. Colour has a tendency to overwhelm a space, so when creating your decor palette, stick to about four colours that can be used throughout the home with one contrasting “pop” colour. The nice thing about colouring your home with decor is that it can easily be replaced when you want to redesign or create a new atmosphere.

Do your kids love to make crafts? Real Simple offers this tip and I couldn’t help myself but include it in this list: throw out the glitter. Glitter is notorious for being the most impossible crafting supply to be cleaned up. Now, imagine what happens when you let this abomination loose in a small space? You’ve seen those glitter bombs? But picture it in your home, where your clothes live and your food! Glitter NEVER really goes away. It hides — lurks in the shadows, in the corners of your cupboard, only resurfacing its sparkly face in the most inopportune moments.

This tip ties in with Real Simple’s point of ditching the sentimental mentality. When living in a small space, you will really have to make some decisions on which meaningful items you keep and which you part with.

For instance, not every single piece of your child’s art collection can earn its spot on the fridge simultaneously. But, what you could do is bring in the tech. Take a digital photograph of your children’s masterpieces and put them on a rotating digital picture frame. That way you don’t have to keep all of the hard copies, but rather select a few of their favourites to store for when they’re older. Plus, they’ll have a digital copy of everything they’ve done on a USB fob when they turn 18 and move out!

Getting outside is one of the best ways to “add more space” to a small home. And now seems to be a good time to get out there as COVID-19 restrictions are being eased up in many provinces. Take advantage of the neighbourhood around you and enjoy quality time with your family as you take a nightly stroll, plan a tobogganing day with hot chocolate or a quick play at the park. Don’t forget to keep yourself and your loved ones safe!

Living in a small space with lots of people and children can be loud, busy and crowded, but by escaping into the wilderness, or even into our own communities, we can take more of that personal time and space while still enjoying the company of our loved ones.

Parents raising their children in smaller residences are becoming a more common occurrence as the housing market is still hard to break into in Canada’s big cities like Toronto, Vancouver and Montreal and Calgary. But with some creativity, planning, organization and absolutely no glitter, you and yours can make it work.

From everyone at RMA, we hope you have a fantastic and fun Family Day with your loved ones.

The post How to live small with a big family in 2023 first appeared on RankMyAgent - Trusted resource about Buying, Selling and Renting.

Besides the stress test, Credit can disqualify you from a mortgage

In a more case-by-case scenario, a common factor for mortgage rejection is poor or no credit history. A credit score is a number on a scale of 350-900, where 350 is bad and 900 is stellar, which explains a person’s ability to pay off their debts or their debt utilization rate (let’s say you have $10 000 of credit available but have only used $1000. You have a 10% credit utilization ate – the lower the rate, the better the credit score). In addition to your history of paying off debt and credit utilization rate, the score looks at how long you have had a credit account, new inquiries for credit, and other factors.

Quite frequently, first-time homebuyers run into issues with their credit score. This could have been a mismanaged credit card or high student loan debts, which would have resulted in a terrible credit score. Another issue is if the person has never had credit. This would result in no credit history that the lender could rely on.

There is hope, however. Even with a bad or missing credit history, individuals can still get approved if they have a guarantor or co-signer. This is someone legally liable for your loan payments if you default. For many first-time homebuyers, a co-signor or guarantor is a family member.

Self-employment is another common way people find themselves unable to approve their mortgage applications. Due to the instability of their income, A lenders find self-employed people a greater risk. Thus, the bank may require a higher taxable income or a larger down payment to approve someone self-employed.

Lastly, life is full of twists and turns, and many people make financial mistakes; this can result in bankruptcy. People who have declared bankruptcy in the past few years won’t get approved by any major bank and will have to seek help from a B or private lender.

The alternatives

While A lenders consist of the major banks (RBC, TD, CIBC and Scotiabank) and the major credit unions (Meridian, Vancity and more), there are many more organizations willing to lend money. However, just because an A lender has declined you doesn’t mean your only option is to take a stroll to a dark alleyway and find a loan shark that charges a 50% interest rate. That’s where B and C Lenders come in: alternative lenders have a lower barrier to entry in exchange for a higher interest rate. They also commonly charge a processing fee of 1-2% of the mortgage and a brokerage fee, usually 0.5% of the mortgage.

It should be noted that using a B or C lender often is not a permanent fix. The mortgage terms tend to be shorter, up to 5 years. Many borrowers use an alternative lender to rebuild their credit and then switch to a mortgage with an A lender later on.

B Lenders

Contrary to what one might think, there are dozens of banks in Canada. Many of these smaller banks, such as Equitable Banks or B2B Bank, allow clients to miss one or more of the components that the big banks look for in a client. For example, they may approve someone even though they have a poor credit history if the applicant has a stable job and no recent bankruptcies. B lenders also more heavily consider the property being purchased in offsetting default risk.

B lenders can also be found at the Big Banks. With Canada’s housing industry roaring over the past couple of years, the major banks have diversified, and their mortgage departments often feature B level lending arrangements.

There is no need to fear B lenders. B lenders are still reliable organizations, commonly listed on the stock exchange, and have many clients worldwide. While banks dominate the mortgage market at approximately 71% of the market and credit unions at 15% of the market, the other 15% or so of the market are B or C lenders. The Canadian Mortgage and Housing Company also approve them as a mortgage lender.

C Lenders (Private lenders)

After both A and B lenders have turned you down, private lenders are usually the last resort. These lenders are often wealthy individuals or a group of individuals who lend out their own money for a better return, such as Mortgage Investment Entities (which can also be B lenders). However, as private lenders take on an even riskier clientele than their B-lending counterparts, they also charge a higher interest rate. As a result, you can expect interest rates anywhere between 10-to-18% and even more.

The barriers to entry for these mortgages are lower than that of B lenders. Instead of approving a mortgage only on credit scores and occupations, a private lender weighs more emphasis on the property type and value. If you are refinancing a home, they also consider the amount of equity you already have. This is not to say that other lenders don’t consider the property itself, but private lenders care more about it. It is the type of property that lenders seek to buy, and their high-interest rates that reduce the risk that C Lenders hold.

Lastly, because you may not be dealing with a massive and trustworthy corporation in the private lending landscape, it is best to have a lawyer thoroughly look over any documentation.

How to get a subprime mortgage: B and C Lenders

The term “subprime mortgage” should not give you a flashback to the 2008 recession. Subprime mortgages are realistically a part of everyday life and refer to any loan granted to those with a poor credit score. The mortgages provided by B and C lenders are usually subprime mortgages.

So if you’ve decided to get one, where should you start? Unlike A lenders, B and C lenders do not have a brick-and-mortar stores at the corners of every major intersection. And while you could scour the websites of every B-lender bank looking for the best rate, it may be more efficient to contact a mortgage specialist.

Mortgage brokerages or freelance mortgage specialists help homebuyers navigate the alternative lending market. They have access to multiple lenders and their mortgage rates, and they can even negotiate a lower rate for you. With their expertise, they can also find the most suitable lender for your situation. However, they take a percentage of your total mortgage as a commission, which can motivate them to approve you for a mortgage you shouldn’t be approved for.

Online mortgage brokers are now also a popular method to scour the B-and-C lender landscapes. These brokers cut margins by operating online and passing the savings onto their customers. Using technology, they can find out who the best lender is for you.

If a major bank has denied your dream mortgage, there’s still hope. Though it may cost a bit more in terms of interest, you can use B and C lenders as a temporary stepping stone you get your credit back on its feet. B and C lenders can help you get one step further to do what you thought was previously impossible.

The post The Ultimate Guide to B and C Lenders: Mortgages beyond the Big Banks first appeared on RankMyAgent - Trusted resource about Buying, Selling and Renting.

This article explains:

• How real estate agents are paid
• The benefits of hiring an agent to buy your first home
• Scenarios where purchasing without a realtor may be less risky

How real estate agents make their commissions during the selling & buying process

The home buying process generally involves a real estate agent representing the seller and another representing the buyer. If your offer on a home is accepted, these two agents work together to negotiate the fine details and close the deal.

The buying agent then negotiates with the selling agent to split the commission paid by the home’s seller. Thus, effectively, the seller pays both the selling and buying agent.

If you purchase without an agent, you could convince the seller’s agent to reduce their fee. This could save you some money overall, but it’s not guaranteed. But is such a discount worth more than the value a realtor brings to your side of the deal?

The home buying and selling process is highly complicated. Buying without an agent means doing your research, booking your showings, and finding other professionals, such as a home inspector or real estate lawyer. This could amount to another job on top of your regular nine-to-five.

The benefits to purchasing your first home with an agent

Home showings

You’ll need to book an appointment with listing agents and plan a daily home showing schedule without an agent. But the benefit to a realtor is that they prepare this for you. All you do is sit back and relax as they take you from showing to showing and bring you through the process of each home.

During a showing, a buying agent can also point out ageing fixtures that may need repair or red flags, such as signs of rot, leaks, or foundational damage. You can then see a property’s problems before putting down an offer and paying a home inspector hundreds of dollars to do an inspection.

Knowledge of the local market

An agent’s value derives significantly from their knowledge of the real estate market. Veteran agents have decades of experience watching the rise and fall of their local real estate market. Realtors further keep up-to-date with the local economy and know what to expect in the weeks and months to come.

Although you should do your research, you likely can’t replicate the understanding of an experienced agent overnight.

If you’re buying in an area you’re not familiar with; the challenge is even more significant. At least with your neighbourhood, you know where the prime locations and best schools are. But if you’re moving to a less familiar area, the whole thing could be a stab in the dark. In such a case, think of an agent as a guiding light.

Your realtor can further help sort the tools available to you as a first-time homebuyer and educate you on using them most effectively. They can also break down complex concepts such as future capital gains taxes and the principal residence exemption.

Negotiating a final offer

When you find a home you like, the next step is to place an offer. Without an agent, you’ll be responsible for the negotiations a buying agent would usually handle. Negotiating effectively requires you to research the market thoroughly, have a sense of comparable houses in the neighbourhood, and understand the pros and cons of the home.

It doesn’t stop at price. Once you get the purchase agreement, you may want to add or take out clauses. Again, if you aren’t working with an agent, it’s even more critical to have a real estate lawyer at this stage to look out for what could negatively impact you without your understanding. You may also want to discuss repairs or minor renovation requests that the seller could complete before signing the final papers.

Although a real estate lawyer can help with parts of the negotiation process, remember that the other side likely has the help of both a lawyer and a selling agent to advocate for their interests.

Tapping into their network

Finally, an agent over their career has accumulated a network of other real estate professionals. Your realtor can likely refer you to a quality real estate lawyer and home inspector who are both critical to the home purchase process.

When buying without an agent is okay

As a first-time homebuyer, having an experienced realtor is invaluable. But not every transaction requires a realtor. For example, the following are scenarios where you may not need a real estate agent:

• Purchase from a family member: If you’re looking to purchase your parents’ home or the home of another trusted family member, then negotiations, the need to book showings, and knowledge of the local market may not be critical. However, a real estate agent can still provide valuable advice on first-time homebuyer tools or alternative ways to purchase the home.
• You have experience in the real estate purchase process: It should go without saying that there’s no point in hiring another agent if you’re a realtor yourself. But if you’ve also purchased properties in the past or had a similar experience, it may justify buying a home without a realtor since you already understand the process. This experience, alternatively, may also help you understand why having a realtor is so important.
• Friend or family with experience open to helping you: It may be an uncle or aunt or  parent who is or was a real estate agent. This individual may be available to help you for free or at a low cost. In such a scenario, you could book your own showings and tap their experience to help with the closing.

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Ultimately, the unaffordability of homes in Canada is due to demand growing faster than supply. Even though in 2018, 37,000 new apartment building units were built nationwide, demand still outpaced supply with 50,000 units of new demand, according to the Canada Mortgage and Housing Corporation. In cities such as Toronto, studies found that new rental housing supplies must double meet the city’s demand. This becomes more difficult as vacation rental businesses through Airbnb and other platforms drain long-term rental supplies.

This lack of supply is why the government is keen to develop new affordable housing units. These developments are not without controversy from residents who believe that affordable housing will decrease their homes’ value and negatively impact their communities.

This article explains what affordable housing truly entails and why a new affordable housing development will likely not damage the community it’s in. In fact, affordable housing developments can have many positive effects. Lastly, we answer whether new affordable housing affects property values in the development’s neighbourhood.

What Affordable Housing Actually Entails

This contrasts with the idea that affordable housing is always government-subsidized living arrangements. In fact, private corporations also commonly develop affordable housing.

Affordable housing that costs less than 30% of household income is essential in major cities. Data by the Canadian Rental housing index showed that Toronto renters, who earned over $45,000 a year, still had to dedicate at least 40% of their earnings to monthly housing costs. Even in the York and Peel region, middle-class income earners devoted still 44% and 38% to housing costs.

Does Affordable Housing Hurt Communities?

Opposition against affordable housing developments commonly comes from the “Not in My Backyard” movement. These people frequently hold negative attitudes towards those living in affordable housing and believe that they bring negative changes to their neighbourhoods. This may include increased traffic, crime, and drugs. Studies have found no correlation between affordable housing developments and increases in violence or crime.

Another complaint is that new, high-density affordable housing development may not “fit in” with the rest of the community. If a community consists primarily of single-family homes, a large housing complex may stick out. However, affordable housing must comply with the same building restrictions as any other home area, including height requirements. They’re also generally designed to fit in with the community.

This type of opposition from community members can increase the cost of affordable housing developments, which often comes from public funds. Instead of money going towards the development, the government must divert funds to manage residents who oppose the development. This use of public funds ultimately benefits no one.

Residents of affordable housing developments can add value to the communities they live in. More residents in a neighbourhood generally increase the tax base, as individuals spend more money within the community and businesses collect more sales tax. This could ultimately decrease property taxes for existing residents. New residents can also increase local labour supplies and create new businesses that add value to the areas that they’re part of.

Does Affordable Housing Affect Property Value

A common notion often perpetuated by the “Not in My Backyard” movement is that affordable housing developments devalue current homes’ property value in the community. A lot of this stems from the belief that affordable housing negatively affects the community, therefore driving down demand for other properties in the area. Property value is often also a proxy for the quality of life in a particular area. If residents perceive that their quality of life will go down due to new affordable housing, they may believe that their property’s value will suffer too. This notion scares current residents dependent on the value of their home as their life savings and source of retirement.

Numerous studies have found that affordable housing doesn’t negatively affect the value of other properties. But despite the research, the negative perception associated with affordable housing remains.

One of the exceptions to these studies is when affordable housing is clustered together or concentrated. Research has shown that this may result in a decline in surrounding property values. What is considered “clustered” or “concentrated” ultimately depends on the community. Further, as long as the affordable housing development design blends in with the surrounding areas and the development’s management are well-managed and well-maintained, it’s unlikely that nearby home values will decline. However, if the development is poorly designed or poorly managed, it could affect the surrounding properties’ value. All in all, these are the exceptions and not the norms.

Affordable housing is an essential need for Canadians who can’t afford to live in many parts of the country. The government has taken steps to develop more affordable housing, but opposition remains. This opposition commonly comes from myths that affordable housing may hurt communities or devalue surrounding property prices. These notions are generally misleading.

The post Three Things to Understand About Affordable Housing first appeared on RankMyAgent - Trusted resource about Buying, Selling and Renting.

Home insurance isn’t mandated by law like car insurance. However, your home is likely the largest single purchase of your life. It’s vital to ensure you’re covered in events such as a flood or fire. Additionally, a home insurance policy is commonly mandated by mortgage lenders as a condition to your mortgage.

In this article, we explain the basics of home insurance to new homeowners. The article explains what home insurance generally covers and doesn’t cover and the types of insurance policies you can purchase.

What Can New Homeowners Expect to Home Insurance Cover?

Damage to Your Home and Others’ Homes and Property

New homeowners commonly think of home insurance in cases where there’s a flood or fire. In events where your home suffers severe damage or destruction, home insurance generally provides the cost of rebuilding your home up to the policy limit.

Further, if a fire starting from your home also causes damage to your neighbour’s house or a detached part of your home, such as a garden suite or shed, your home insurance policy may also cover these costs.

Not all forms of damage are covered, however. And it’s up to you to choose what is and isn’t part of your policy. Some events to look out for in your policy include:

• Flood: often not available for purchase in areas that commonly see flooding
• Windstorms: structural damage may be covered, but water and hail damage may not be
• Sewer backup: damage from backed-up sewers, drains, toilets, and showers
• Earthquake

Further, “predictable events” are not covered. I.e., if you don’t drain your pipes in the winter and they burst, your insurance won’t cover this. Damage that’s a result of not maintaining your house is also not covered. For example, if you don’t regularly replace your roof, and this results in water damage to your home, your insurance won’t cover repair costs.

Damage or Loss of Personal Possessions

If your home burns down, it’s not only about rebuilding your home but also replacing its contents. Home insurance policies cover damage or loss of your personal property, including incidents such as burglaries.

There’s a long list of what and when a home insurance policy won’t cover personal property. Typically, home insurance policies don’t cover:

• Loss or damage of items when they’re outside of your house or inside your vehicle
• Expensive jewelry or fine art. This commonly requires a separate insurance policy or must be added to your policy after the insurance company appraises the jewelry or fine art.
• Equipment breakdown, such as a laundry machine or HVAC system — even if it’s not unforeseen and unrelated to general wear and tear
• Equipment or stock related to a business. This requires a business insurance policy. Additionally, home insurance doesn’t generally cover any business-related damages or losses, even if you run your business from your home.

As your years of homeownership go by, you’ll accumulate more things in your home. It’s important to keep an inventory of what you own and regularly renew your insurance policy. The worst-case scenario occurs when the property inside your home is destroyed, damaged, or stolen, and you discover that your insurance doesn’t cover this loss.

Additional Living Expenses if Your Home Becomes Uninhabitable

Suppose something happens to your home. It could be a fire, weather damage, or another unpredictable event. Your house may become uninhabitable, and you and your family may need accommodations such as a hotel or short-term rental until the situation is fixed.

As a new homeowner, you can rest assured that your homeowner’s insurance covers these associated costs to the policy’s limit. Home insurance policies may also cover lost rental income if you used your property fully or partially for rental.

Damage of Injury When Someone Visits your Property

As a homeowner, you may be personally liable for injuries that happen on your property. For example, if a guest trips or slips as they reach your front door, which causes the guest an injury, they could sue you for damages. This is a common instance that home insurance is set to protect new and veteran homeowners alike.

To further draw the line between business insurance and home insurance, most home insurance policies won’t cover personal liability damages if the person visiting your home is a client. To ensure that you’re covered if your business client visits your home, you need a general liability business insurance policy.

What Types of Home Insurance Policies are Available?

Home insurance policies vary depending on what you need. Some new homeowners may need a home insurance policy with more or less coverage. Some new homeowners may want protection against earthquakes or floods, which many policies don’t cover. There are generally four types of policies you can expect when you speak with an insurance agent or broker:

• Comprehensive: A policy that provides the most coverage and protects your home from all risks unless expressly excluded by your policy.
• Standard: A policy that provides less coverage than a comprehensive policy and only covers instances and risks mentioned in the policy.
• Broad: A policy that sits between Comprehensive and Standard. Generally, it provides a Comprehensive policy (covers all risks unless excluded) for your home but a Standard policy (only covers what’s mentioned) for the contents inside your home.
• No-frills: The policy that provides the least coverage. A no-frills policy may not offer enough coverage to satisfy requirements by mortgage lenders.

Regardless of your policy, it’s important to regularly revisit your policy as your home’s contents and your home itself change. You want to notify your insurance company whenever:

• Your home is damaged, vandalized, or robbed
• You make renovations to your property — especially if you’re getting a pool
• You start a business from home
• A guest is hurt while visiting your home

Homeownership comes with many risks, but the right insurance policy can help mitigate much of these issues. It’s essential to understand your policy’s coverage to avoid surprises once you need to make a claim.

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If you’re looking for an influx of cash, then it may be worthwhile to borrow money that’s secured by your home’s equity, otherwise known as a home equity loan. This method of borrowing can be much cheaper than other borrowing methods. That’s why about 10% of Canadian homeowners took equity out of their home in 2018 to secure a loan. The most common reasons for this loan were to fund investments, renovate their home, consolidate debt, and make purchases.

In this blog post, we’ll look at three of the most popular home equity loans: HELOCs (Home Equity Line of Credit), second mortgages, and reverse mortgages. This piece will outline the benefits and downsides of each and inquire into why they’ve gained so much momentum.

Home Equity Line of Credit

A HELOC works like any other line of credit would, except the debt is secured by your home. Like traditional lines of credit, you have the ability to withdraw what you need, when you need it. The money is also re-advanceable if you pay it back, and you’re not responsible for any interest on unused amounts.

However, they also commonly come with variable interest rates, which can go up as general interest rates rise too.

They’re great for situations where you don’t know how much money you’ll need, and it’s never a bad thing to have cash ready in case of an emergency. But the downside to a HELOC is that lenders usually want to see that you have good credit and income, as well.

A bank or lender can call the debt on a HELOC at any time. That is, they can ask the borrower to pay it back at any time—something most borrowers don’t understand about this line of credit. This isn’t likely, however, because calling the HELOC debt of millions of Canadians can end up hurting the bank’s own profits.

This fact proves something else: Canadians don’t fully understand the terms and conditions of their HELOC—which was also discovered by the Financial Consumer Agency in a survey that found participants usually scored less than 50% when answering questions about their loan. The survey also found that 25% of respondents only made interest payments on their HELOC.

Second Mortgages

A second mortgage is a loan that’s secured with your home’s equity, similar to a HELOC. But, instead of taking out money when you need it, the capital is provided as a lump sum. It’s common that a bank or lender will provide up to 80% of the appraised value of your home minus what you owe on your first mortgage.

This home equity loan is called a second mortgage because it’s ultimately second to your primary mortgage—i.e., in the event of a default, your first mortgage is paid out in advance of the second one. This is why the amount you can borrow depends on the home equity you have.

Unlike a HELOC, second mortgages can accommodate individuals with lower or less stable incomes or individuals with lower credit scores. The interest rate may be higher than a HELOC as a result, and the rate will definitely be higher than your initial mortgage since the second mortgage lender is in a riskier position. On top of this, there will be legal and broker fees to arrange the loan, adding another cost in addition to interest payments.  

It’s important to remember that a second mortgage will mean you now have two mortgages to pay off. If you miss a payment on either, it could result in the lender foreclosing your home.

Reverse Mortgages

A reserve mortgage is a great way for retirees to supplement their retirement savings or government income or to get a large sum of money for renovations, a grandchild’s education, or sudden expenses. To qualify for a reverse mortgage, you and your spouse both need to be over the age of 55.

The loan can come in the form of a lump sum payment or in monthly installments. And, no repayments are required until the home is sold. For this reason, a borrower typically does not need to plan how they’ll repay the loan because it comes out of the future proceeds of the home sale. In a reverse mortgage, you essentially give up equity in exchange for receiving monthly payments—the reserve of what you’d do in a regular mortgage. All the while, the qualifications to borrow this way are much lower than the qualifications required for a HELOC.

The convenience of reverse mortgages has resulted in its 20% annual growth. Though many criticize the tool for its high-interest rates.

A home equity loan can be a powerful tool. It effectively allows you to borrow money at a lower interest rate or with fewer obstacles by leveraging your home’s equity. This money is perfect when you need capital for home renovations, to pay for a child’s education, or to consolidate debt. The biggest downside is that you put your home at risk.

This blog post went over three kinds of home equity loans: A HELOC, which can provide easy access to capital at a low interest rate; a second mortgage, which can provide a lump sum payment without onerous income or credit score conditions; and a reverse mortgage, which allows retirees to leverage their home equity to supplement their retirement savings. There are others home equity loans out there and lenders are sure to create more.

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What is a vendor take-back mortgage and how does it work?

A VTB is when the seller of a property also becomes the lender. The seller lends money to the buyer to purchase the property that the seller is offering. This provides the buyer with more access to capital and the seller with an easier sale. The seller, in becoming a lender as well, charges an interest rate that is usually more than what a bank charges but less than what a private lender charges.

For example, if a home is $500,000, a 20% down payment would be $100,000. If you only have $50,000, you could get access to another $50,000 through a VTB. The bank would then provide the remaining 80% or $400,000 to the buyer to purchase the property.

There are a few issues with VTBs. First, the bank has the right to prevent a VTB from taking place. The bank is still a lender, and they can choose not to lend if you are already borrowing from someone else. Second, the seller needs to at least own the amount of equity in the home equivalent to what they’re lending you—i.e., if the VTB is for 10% of the purchase price, then the seller must own at least 10% of the home. Additionally, a VTB is still a mortgage. As a result, putting down 10% of the purchase price with your own funds followed by a 10% VTB won’t provide you enough equity in the property to avoid mortgage default insurance, adding another payment to your home purchase expenses. 

Benefits and precautions to the seller

For the seller, the primary benefit of a VTB is to sell your property. Offering buyers a VTB is a great way to sell in a buyer’s market because it can incentivize a purchase without lowering your offering price. However, if you’re selling your primary home, you’ll still need a place to live. And if you’re not planning to downgrade, you’ll likely need the full proceeds from your sale to purchase a new property. But if you decide to lend the money, you’ll be rewarded with some generous interest payments.

If you sell a $7 million commercial property, there are only so many people in the area who can afford it. A VTB can enlarge your pool of buyers by offering them more access to capital. 

By doing this, there are also tax benefits. When you sell a property that isn’t the home you regularly live in, you must pay capital gains tax. With a VTB, you’re paid out over time which means you defer paying this capital gains taxes over the life of the VTB.

Keep in mind that you and the buyer don’t only have a buyer-seller relationship now, but also a lender-borrower relationship. Therefore, you’ll have a second contract to work out the terms of the lending agreement. This requires that you do due diligence on the buyer to make sure that they’re credit worthy. Your loan will be treated as a second mortgage, which is only paid back after the primary loan (likely the bank’s or private lender’s) is paid out in the event of a default.

Additionally, more agreements mean more lawyers. At least lawyer fees, anyways. Make sure to draft a contract with the buyer to set out the terms of the repayment. A lawyer should help revise this contract and read over the terms and conditions.

Benefits and precautions to the buyer

The ultimate benefit for you as a buyer using a VTB is the additional access to capital. Although you’ll likely pay a higher interest rate than if you borrowed it all from a bank, you may have bad credit or other impediments that prevent you from borrowing what you need.

Another scenario is if you’re purchasing a large investment or commercial property and where a bank may not lend you multiple millions of dollars. Without a VTB, you as the buyer would have to find capital through either investors, who would want equity in the property, or from private lenders, who likely charge higher interest rates than what a VTB offers.

But, for the typical residential property, VTBs are not common unless we’re in a buyer’s market—something rare in Canada’s housing markets

As a buyer using a VTB, you need to remember that this is another loan that you need to pay back. Therefore, it’s part of your monthly interest expenses and an additional liability in addition to any other mortgages you have. And as mentioned prior, the interest rate for the VTB will likely be higher than a bank’s interest rates. 

A VTB is a great tool to add into your real estate purchasing kit. It can help a buyer purchase a property when they can’t otherwise source enough capital to do so. It can help a seller get rid of a property faster, make more money in the long term, and defer capital gains taxes. But, as a buyer, make sure that you can afford what is likely an additional mortgage. And as a seller, double check the borrower’s credit history and make sure you have a contract ready.

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