6 mistakes to avoid if you want to be an owner before you retire in Quebec

Not knowing your credit score

First, it is important to know if your credit score is favorable for buying a property. In fact, it is necessary to even check the quality of this index before starting such a project. “In general, what we’re looking at is just the credit history that predicts a little [si] the person has good habits in using their credit cards and all that. This is an element that lenders examine,” Vincent Déziel of Scotiabank emphasizes.

Another element that can be added to the ranking: your income and its stability. “Lenders are subject to different rules. For someone who voluntary (self-employed), a specific history must be shown in relation to someone who has a job with a basic salary and permanent hours. So every job, every situation. Then today, I think we see it even ten or fifteen years ago, working conditions are changing a lot. Therefore, all these aspects must also be considered when getting a mortgage loan,” said the latter.

Forgo mortgage pre-approval

This process, which allows you to assess your borrowing capacity based on your current financial situation, is not mandatory. However, it is recommended not to neglect. “Sometimes, people who skip this step have an unpleasant surprise. If we say to ourselves: “I earn about the same salary as my brother-in-law or my friend, and he bought a house of $700,000. I should be able to do it too, we make the same salary. ” However, there are other factors that come into play. [la capacité d’emprunt]. Do you have a loan with more savings, less savings? », citing Mr. Déziel for example.

In addition, neglecting this step can completely cancel the plan to buy the house you want. “In general, with the purchasing process in Quebec, we have a very tight deadline. Once we have finished negotiating the price, then the various conditions with the seller, we have about 10 to 15 days to meet all the conditions. SO, [ça peut nuire à] someone who is not ready before submitting a purchase offer,” emphasizes the latter.

Running without planning anything

Although the idea of ​​buying a house can be very exciting, a decision without careful consideration can lead to mistakes or difficult choices. “Four years ago, in the midst of COVID, I decided to move and then buy another property. For me, my daily life is the mortgage. Then, despite that, I was still under a lot of pressure. It’s a very emotional part and everything that surrounds this business, still, it can be stressful for some. It’s a short period of time to collect our income documents, proof of payment​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​, we have to think about the notary, we have to think about moving. Almost everything happens at the same time, very briefly. Therefore, the things we can prepare in advance help us to manage this time with better decisions, to make more informed choices,” the mortgage expert suggests.

Not confirming your needs

To avoid this mistake, it is advisable to arrange appointments with professionals even before you make your first visit.

“It’s often what we see […] someone who moves in two or three years. Is there a big change in his life? And there, we are told: “No, we fell in love at the time of the purchase, but in the end, the building meets our needs more. The children went from primary school to high school, and school is too long”. Whatever the market situation, the bad decision, we suffer afterwards, even if we had good business If the building does not meet our needs, in the end, we punish ourselves,” said Mr. Déziel.

So it is important to be rational and strategic when facing one of the biggest investments for most households. “Sometimes, the house you love may have extra costs, things we haven’t thought of and that don’t fit into our budget. A professional, who is used to talking about these situations, and then guiding clients through them, can help them make the right decision,” he said.

Forgetting to plan for special expenses and financial aid

The costs associated with buying real estate can add up quickly, especially for properties that need a lot of renovation. “For someone on a lower budget, by buying an older property, you can benefit from credits if you make energy efficient renovations. [par exemple]. But if you, as a customer, do not know this and no one has advised you, it can be expensive. There are different steps to follow to measure the energy cost of the house before and after the work. It is certain that if you did not do it at the beginning, if you did not think about it, it is possible that you will lose these savings,” said Mr. Déziel.

Losing hope of being able to buy

If the figures show that there are fewer young owners this year in Quebec, this fact is not inevitable by taking special measures. “Yes, we saw people in a little more trouble, but not particularly. People agreed to cut some discretionary costs elsewhere, and go out less, knowing that it would probably be temporary. Despite major changes in the market, you can own your property and improve your financial situation despite everything,” concluded Mr. Déziel.