Real Estate Vocabulary Cheat Sheet
First-Time Home Buyer
Buying your first home in Canada can be an exciting journey, but it’s essential to familiarize yourself with the key terms that will guide you through the process. Here’s a “Real Estate Vocabulary Cheat Sheet” tailored to the first-time home buyer:
Real Estate Vocabulary Cheat Sheet – First-Time Home Buyer – Elevate Real Estate Group – Royal LePage Triland
Offer
An offer is a formal agreement between a buyer and seller outlining the terms of the property purchase, including the price, closing date, and any conditions. Once signed by both parties, it becomes a legally binding contract, known as an Agreement of Purchase and Sale (APS).
Home Inspection
A home inspection evaluates a property’s condition, typically carried out by a qualified home inspector chosen by the buyer. The inspector examines significant components like the roof, plumbing, electrical systems, HVAC, and foundation to identify any issues or necessary repairs. While not mandatory, a home inspection is strongly recommended to ensure your investment is sound.
Title
The title refers to legal ownership of the property. Before closing, the buyer’s lawyer conducts a title search to ensure no liens, unpaid taxes, or legal disputes are tied to the property. This process ensures clear and undisputed ownership once the transaction is completed.
Appraisal
An appraisal is a professional valuation of a property’s current market value, often required by lend. Lendersrs to crequire appraisals to confirm that with the mortgage amount. Appraisals consider factors like the property’s condsuch asn, size, location, and comparable sales in the area.
Insurance
Homeowner’s insurance is required to protect your property against risks like fire, theft, and certain natural disasters. Before closing, you’ll need to secure insurance coverage and provide proof to your lender. Be sure to shop around and compare policies from multiple providers to find the best coverage and rates.
Down Payment
The down payment is the initial payment you make toward the purchase price of a home. In Canada, the minimum down payment depends on the home’s price:
- 5% for homes under $500,000
- 10% for the portion of the price between $500,000 and $999,999
- 20% for homes over $1,000,000
If your down payment is less than 20%, you’ll need mortgage loan insurance through providers like the Canada Mortgage and Housing Corporation (CMHC).
Closing Costs
Closing costs are additional fees and expenses you’ll need to pay when finalizing the purchase of your home. These typically include:
- Legal fees
- Land transfer taxes (varies by province)
- Adjustments for property taxes or utilities
- Title insurance
Budget about 1.5%-4% of the purchase price for closing costs.
Conditions
Conditions are specific requirements in the Agreement of Purchase and Sale that must be met for the deal to proceed. Common conditions include:
- Financing Condition: Ensures the buyer can secure a mortgage.
- Home Inspection Condition: The buyer can back out or renegotiate if the inspection reveals major issues.
- Status Certificate Condition (for condos): Provides details about the condo’s financial health and rules.
If conditions are not fulfilled, the buyer can walk away without penalty.
Pre-Approval
A pre-approval is a commitment from a lender indicating how much mortgage you qualify for, based on your income, credit score, and debt. Having a pre-approval helps you set a realistic budget and demonstrates to sellers that you’re a serious buyer.
Amortization
The amortization period is the length of time it will take to fully repay your mortgage. In Canada, the maximum amortization period is 25 years for mortgages with less than a 20% down payment. For mortgages with a down payment of 20% or more, some lenders may offer longer amortization periods.
Land Transfer Tax
When you purchase a property in Canada, you’ll need to pay a land transfer tax (or property transfer tax), which varies by province. First-time homebuyers may qualify for rebates in some provinces, reducing this cost.
Property Taxes
As a homeowner, you’ll pay property taxes annually, based on your property’s assessed value. These taxes are used to fund municipal services like schools, road maintenance, and emergency services.
This “Real Estate Vocabulary Cheat Sheet” provides a solid foundation to help you navigate the confidently navigating market confidently. If you have any questions, your real estate agent or lawyer can provide personalized guidance!
The Elevate Real Estate Group ( Brittany, Victoria, Stewart, Jeremy, and Caitlyn)
Why Choose Elevate Real Estate Group?
At Elevate Real Estate Group, we understand that buying a home is a significant decision. That’s why having the right team by your side is essential. Our experienced realtors—Stewart Blair, Jeremy Odland, Brittany Wurfel, and Caitlyn Ford—bring unmatched expertise and dedication to every client.
Additionally, our in-depth knowledge of the London, Ontario, market allows us to confidently guide you through every step of the process. From the initial consultation to the moment you receive your keys, we’re committed to making your journey smooth and stress-free.
Learn more about Elevate here, Meet the Elevate Real Estate Team
Elevated Excellence in Real Estate
When you ask our clients, you’ll hear time and time again how we stand out in a competitive market. Our unwavering focus on Ethical Behaviour, providing the Best Client Experience Possible, and maintaining a Commitment to Excellence sets us apart.
Unlike others in the industry, we do not chase awards, focus on sales volume, or rush through deals to move on to the next client. Instead, we care about Every Client, Every Deal, Every Time. Whether you’re a first-time buyer or a seasoned investor, you can trust us to deliver the care and respect you deserve.
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Do you have questions or need personalized advice? Call us at 519-933-6198. Let’s work together to find the perfect home for you! You can also use the Contact Us page.
More From The Elevate Real Estate Blog
Exploring real estate in London, Ontario? We’ve covered you with various blog posts designed to guide you through every step of the buying or selling journey. Whether you’re considering a move to London, preparing your home for showings, or looking for expert tips on navigating the real estate market, our curated resources are here to help. Dive into the posts below for actionable advice, local insights, and strategies to make your real estate experience seamless and successful. Each blog is tailored to provide you with valuable knowledge to make confident, informed decisions in the London, Ontario, real estate market.
10 Reasons To Consider Moving to London, Ontario
The Importance Of Working With A Local Realtor
Your Essential Home Buyers Guide: Top 10 Tips for Buying a Home
How to Sell Your Home in Just One Week [A Free Guide]
Steps To Take Before Beginning Your Home Search
Elevates Concierge Real Estate Services
How To Prepare For Showings When Your Home Is On The Market
Understanding Closing Costs When Buying a Home
Closing costs are an essential part of any real estate transaction, covering legal fees, land transfer taxes, and other important expenses. Knowing what to expect can help you budget effectively and avoid surprises. Learn more about closing costs here: What Are Closing Costs?
Buying a Home Without Conditions – What You Need to Know
Waiving conditions can make your offer more competitive, but it comes with risks. Learn the pros and cons here: Buying a Home Without Conditions
Find Us Online
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