Ontario Real Estate: Good Buys, Great Mortgages, Limitless Opportunities

Author: rationale | Posted: 18.08.2008

Despite the myriad of fear-instilling headlines in all the major papers, the Ontario real estate market is NOT on the verge of collapse, or disarray, or whatever the latest misleading headline is touting; the troubles within the industry are actually only applicable to those who sell real estate products and whether they’re making as much money as they were a few years ago. The reality is, they’re not; the slowing world economy and Canada’s weather have taken a toll on sellers in Ontario and parts of the nation. But here’s another reality: the Ontario sellers’ hardship is the would-be Ontario buyers’ golden opportunity, and that’s the story that isn’t making headlines in the papers so here’s the inside scoop…

The fact that Ontario sellers are struggling is actually good for buyers, thanks to the natural ebb and flow of supply and demand. With contractors and sellers in Ontario not being able to move homes / condos as fast and existing home sellers struggling to unload properties too, there’s a major real estate surplus in the region. That means that would-be homebuyers can negotiate uncanny steals on real estate! The one catch to this great buying opportunity for homebuyers: Qualifying for a mortgage with a Canada mortgage company or bank is still a must! So, if the newsflash above has got you thinking about buying, keep the following in mind as you seek financing for your house:

Do your homework. Not every type of mortgage is best for you. Though an Ontario mortgage consultant will explain why a particular type of mortgage loan is best for you / your situation, you should begin your mortgage loan search with a basic understanding of the various types of Canada mortgage loans that are available.

Remember: Credit is still king. Whether you’re applying for an Ontario mortgage or a mortgage loan anywhere else in Canada, having a good credit history will work in your favor. It will make you eligible for a wider variety of Ontario mortgage loans and it will help you to negotiate for lesser interest rates on your mortgage loan.

Shop around. Despite the variety of Canada mortgage options available, many people still think that the bank is the best financier to contact for a mortgage! Now, it’s not that a national bank isn’t a good place to go for a mortgage; it’s just that a local, Ontario mortgage company may be a better option. The reason is simple: Banks have a small collection of mortgage loans they can offer, many with very rigid interest rates and stipulations. Plus, with the economies of many major world markets being so unsteady, many banks are being exceptionally choosey about those to whom it will provide a mortgage loan. Meanwhile, Ontario mortgage brokers have access to dozens lenders, which often gives them more loan options and flexibility in offering interest rates. As an added bonus, excellent credit standing is still great to have but imperfect credit isn’t a “deal breaker” with Ontario mortgage companies as it often is with the local banks. Don’t misunderstand. Ontario mortgage companies have also raised the bar on mortgage loan requirements, but they don’t scrutinize nearly as much.

Pre-approval is power. By being pre-approved for a mortgage loan, you’ll certainly wet any hungry seller’s appetite. Why? Well, that pre-approval mortgage letter lets sellers know that if they want to close the deal sooner rather than later, they can do it without having to worry about whether financing will come through. That’s a huge benefit for you as a buyer throughout Ontario, and anywhere in Canada really, because it gives you the upper hand when negotiating. Imagine how it would feel to walk up to the seller of your dream home and say, “I want this property for X thousands of dollars below your asking price and I’ve got the papers to prove I can afford to take it or leave it!” That would be empowering!

No knee-jerk reactions! It may be tempting to jump into an Ontario mortgage and take advantage of the current Canada real estate market but be advised: Only do so if you’re ready. That means having a minimum of 5% of the home price you think you can afford saved for the down payment as well as monies for any fees related to closing on the home. Plus, you’ll need to have money budgeted for home maintenance, mortgage insurance, and all of the other expenses that come with being a homeowner.

If you’re not quite ready, that’s okay. Visit an Ontario mortgage consultant anyway to find out what you’ll need to do to be in optimal condition to buy when you are ready. As for those of you who have been saving up, waiting for the market to be “just right,” wait no more!