Hi guys,
Can i buy brand new freehold townhouse on 5% down? Denial new homes will be coming next month.
Any idea how to book home. I heard people line up since morning. What is the procedure. What the really need. What should i take with me.
If I like the house what are the other expenses , fee or tax on new home. I am first time home buyer.
Pls. Guide me.
Thank in advance.
Quote:
Originally posted by adnancanada
Can i buy brand new freehold townhouse on 5% down? Denial new homes will be coming next month.
Thank in advance.
Quote:
Originally posted by adnancanada
Any idea how to book home. I heard people line up since morning. What is the procedure. What the really need. What should i take with me.
Quote:
Originally posted by adnancanada
If I like the house what are the other expenses , fee or tax on new home. I am first time home buyer.
Hi Adnan,
Mr. Bhootnath has explained in quite details and answered most of your questions.
I would like to add / explain some more points.
1. Even though you can buy with 5% down, it would be better if you could put more in down payment to save on CMHC fees.
For example, if you buy the town house for $300,000 and put 5% down payment and take 30 year amortization, you would have to pay $8407.50 in CNHC feees and over $672 in PST. However, if you put 10% down for the same townhouse, the CMHC fee would be $5940 and the PST would be $475. Moreover, you would have lower monthly mortgage payments as well.
On a lighter note, people can buy even with ZERO down payment but end up paying higher CMHC fees and much higher mortgage rates.
2. Being a qualified first time home buyer, whether new or resale, you would be able to get rebate on Land Transfer Tax but it would be only up to a maximum of $2,000 rebate from Ministry of Finance. Here I am considering that you are in Ontario as you have not mentioned your place of residence. However, if you buy the townhouse in Toronto, then their is addition land transfer tax and rebate up to a maximum of $3,750 for qualified first time home buyers. For all details on these taxes and rebates, visit these http://www.fin.gov.on.ca/en/tax/ltt/faq.html , http://www.fin.gov.on.ca/en/bulletins/ltt/1_2008.html , http://www.toronto.ca/taxes/mltt.htm
3. The builder may ask you to produce a pre approval for the mortgage for booking the townhouse, so it would be better to get yourself approved first before heading to the builder. Also, it would let you know how much you can qualify for and lock the rate as well.
Last but not the least, it would be a good idea to see a mortgage professional from your bank or the one referred by your family and friends who will take time to understand your needs and explain the whole process to you to make your first home buying experience an enjoyable one.
Good Luck.
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Pramod Chopra
Senior Mortgage Consultant
Mortgage Alliance Company of Canada
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