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Buying Process

Welcome to the exciting world of home buying, where each door opens to the possibility of ​creating lasting memories and building your future. Whether you're a first-time buyer or a ​seasoned homeowner, the journey to finding your perfect home is a thrilling adventure.

1.

Loan Pre-Assessment

I strongly recommend scheduling a meeting with a mortgage expert before viewing a property. To know oneself and the ​opponent is the key to avoiding a hundred battles without danger.

There are three benefits to doing this: ensuring that there are no issues with your credit record, no undiscovered debts that ​haven't been repaid in a timely manner, and that your credit record is accurate; locking in the current interest rate; knowing ​how much money you can borrow. a. After obtaining a pre-approval document from the bank, consumers can add their ​down payment to the loan amount to determine the target property price. b. Completing the property transaction within the ​interest rate lock-in period allows you to apply the locked-in interest rate, typically lasting for 90-120 days. c. If any issues ​with the credit record are discovered during the pre-approval process, including inaccuracies and outstanding debts, ​immediate action should be taken to remedy the situation.

In summary, I am providing some general knowledge for reference only and not as financial advice. Buyers should seek ​advice from professional experts.

2.

Selecting the Area (LOCATION)

If you don't need a real estate agent, be sure to do sufficient research. Consider key factors such as school districts, work ​convenience, natural environment, safety, community amenities, cultural atmosphere, and potential for appreciation. Choose the ​best practical option based on your own needs.

If you need a buyer's agent, communicate and interact fully with the agent on these factors. Once your budget or requirements ​change, inform the agent promptly. Experienced agents, after hearing your needs, will recommend suitable areas or communities to ​you as soon as possible.

Looking at the geographical development history of Greater ​Toronto, it has generally developed from south to north, with ​YONGE Street as the central axis, expanding eastward or ​westward. Therefore, homes in the northern part of Toronto are ​generally newer than those closer to the south (excluding ​renovated houses or newly built condos), with the distance from ​Yonge Street being a factor in the age of the houses.

Regarding specific areas where the Chinese community resides, ​areas such as Richmond Hill and Markham generally have newer ​housing compared to North York and Scarborough. Buyers who ​prefer newer homes may consider the first two areas. From another ​perspective, the latter two areas have a slight advantage in terms ​of transportation and convenience.

The decision of the location is the most crucial aspect throughout the entire home-buying process. The importance of LOCATION ​has been extensively discussed in various articles, and the host will not dwell on it further. In my years as a real estate agent, I ​have seen many buyers purchasing homes in good neighborhoods, then later moving to slightly smaller houses or condos after ​their children go to college, achieving both self-residence and investment gains. Good neighborhoods generally combine factors ​such as excellent school districts, a positive cultural atmosphere, a pleasant natural environment, and convenient transportation. ​Therefore, homeowners enjoy happy and content living for several years and, when selling, often gain substantial returns.

In the flip side, there are also examples where housing prices in cities or towns that once thrived due to certain declining ​manufacturing industries in Ontario have plummeted. Homeowners looking to sell and move to other cities are forced to sell at a ​loss. This is true even in Toronto, where, without thorough research, some buyers in certain 'dead zones' have experienced ​significant losses.

3.

Viewing

Viewing a house is an exciting part of the home-buying process.

Before viewing a house, I usually email the selected listings to clients, providing details about the appearance, orientation, ​entry points, land size (LOT), usable area, flooring types (solid wood, laminate, or carpet), specific dimensions of the kitchen, ​living room, and each bedroom, the number of bathrooms, and any appliances included in the purchase price. This information ​helps clients have a clear understanding before the actual viewing.

During the actual viewing, I typically adopt an outside-in approach. Externally, this involves two main aspects: the house's ​location within the community and the external appearance of the house. The location within the community is crucial; for ​example, some houses in good neighborhoods may be close to major roads, resulting in noise, dust, and air pollution, which ​should be avoided. If the house is adversely affected by road conditions or street corners, I generally advise clients to ​reconsider. For corner lots, some rear yards may be relatively small, and I inform clients of this, respecting their preferences, ​as some clients prefer corner lots.

The external appearance of the house also provides valuable information. Different architectural styles, such as bungalow, ​raised bungalow, side-split, back-split, and 2-storey, often reflect the construction era. The age of the roof, whether it needs ​replacement, directly affects the price quote. Large trees in the front or back yards may be a concern if their roots are too close ​to the foundation. Older windows not only impact aesthetics but also increase heating costs in winter. Therefore, understanding ​the condition of all windows, including those in the basement, is crucial.

Moreover, replacing windows is an absolutely hefty expense. In addition, when examining the exterior, it is essential to check the ​materials used for the outer walls, whether there are any loose components, and if there are cracks in the structure. Points to ​consider include checking for leaks in the downspouts, and ensuring that the roof is properly washed during drainage.

Entering the interior, the focus should be on the overall layout of the rooms and whether the structure is suitable for one's family, ​without any obvious space wastage. In general, upon entering a Canadian home, one typically encounters the kitchen, dining ​room, and living room. Most kitchens are designed with space for a breakfast table, while formal dining is reserved for the dining ​room. By the way, the majority of Westerners have a tasteful dining table and chairs.

Many buyers prefer spacious, well-lit living rooms and bedrooms, along with more bathrooms, reflecting a trend in modern house ​design. For slightly older homes, buyers often desire at least a master bedroom with a fully functional ensuite bathroom, ​transforming it into a true Master room.

4.

Placing an Offer

In Ontario, the comprehensive document for a residential offer is commonly referred to as the 'Agreement of Purchase and ​Sale.' It is an industry-recognized standard document that is acceptable to both the buyer and seller. However, it does not ​exclude the use of other purchase contract documents, provided that both parties agree. If a buyer wishes to use a different ​document, it is essential to communicate and reach an agreement with the seller beforehand.

The typical procedure for making an offer is as follows:

1. Call the listing agent of the seller, and the real estate agency will ask for your contact information ​and notify (page) the seller's agent.

2. The seller's agent will call back your agent, informing them of the method of accepting the offer: ​whether it will be submitted in person, by fax, or email. If face-to-face negotiation is required, details ​such as the location (whether at the property being sold, the seller's agent's office, or another ​location) will be provided.

Some common additional clauses seen in offers include:

Financing Condition:

This clause states that within a certain number of days after the contract is signed, the buyer has the right to apply for a ​loan from a financial institution. If the buyer cannot secure the loan, they have the right to cancel the contract.

Inspection Condition:

This clause allows the buyer to inspect the property within a certain number of days after the contract is signed. The ​buyer must be satisfied with the inspection results for the contract to continue. Otherwise, the contract becomes void. ​Inspection conditions can be categorized into two types: BUYER'S SATISFACTION and MAJOR DEFICIENCIES. The ​former means that the inspection results must satisfy the buyer; otherwise, the buyer can abandon the contract based ​on a defect found in the inspection report. The latter implies that there must be significant deficiencies in the property for ​the buyer to cancel the contract.

Condo Document Condition:

This condition applies to properties that require the payment of condo fees. It requires the seller to provide the ​condominium status certificate within 10 days. The buyer must allow their lawyer two business days to review the report. ​If the lawyer identifies significant issues, the buyer can, under the lawyer's advice, choose to abandon the purchase.

It should be noted that if a buyer wishes to cancel the contract based on conditions, they need to provide the seller with ​corresponding document proof. For example, a rejection letter from the financial institution for the loan, an inspection report issued ​by the inspector, and a lawyer's letter, among others. This is not only a sign of respect for the seller but also a respect for relevant ​laws. Buying and selling property is a serious transaction for both parties, and the purchase contract is a meticulous legal ​document.

Another point to clarify is that reviewing the management report is specific to properties that incur management fees; for ​properties without management fees (Freehold), this condition is not necessary in the offer.

There are two scenarios for waiving conditions. One is when no issues are found, and the buyer directly waives the conditions. The ​other is when some issues are discovered, but the buyer is unwilling to cancel the contract. In this case, negotiations can be held ​with the seller to seek compensation or remedial measures acceptable to both parties, which can be written into an Amendment to ​the Agreement of Purchase and Sale and signed by both parties.

5.

Lawyer

The lawyer, in turn, handles all related legal matters for you after you sign the purchase and sale contract. If there are any legal ​issues in the performance of the contract by both buyer and seller, each party can seek assistance from their respective ​lawyers. (This chapter provides information based on understanding and does not constitute legal advice. For any real estate ​legal issues, please consult a professional lawyer.)

6.

Loan Processing

Once all the conditions of the contract are canceled, you can formally contact the bank loan officer or mortgage broker to ​initiate the loan application process.

Before meeting with the loan expert, inquire about the documents you need to bring. Different banks have varying ​requirements, but generally, the documents you need to prepare include: the purchase contract (Offer), information about the ​property (Listing Sheet), income statements, employer letter, proof of down payment (or savings), driver's license or passport, ​etc. For new immigrants purchasing a home with a down payment of 35% or more, income proof may not be required, but it will ​be necessary to demonstrate sufficient savings to cover daily expenses for at least six months (including mortgage payments, ​property taxes, etc.). If all the documents are complete, you can typically expect formal results within one to two business days.

7.

RE-VISIT

Before the property handover, there are usually one or two visits, which we refer to as RE-VISIT. The first visit can be ​scheduled at a convenient time for both the buyer and seller, and it's preferable to inform the seller to be present during the ​RE-VISIT. This is because the seller generally needs to introduce how various appliances in the home work, including the ​fireplace, central air conditioning, washing machine, dryer, dishwasher, and more. Additionally, the buyer may measure rooms ​such as the living room, kitchen, bedrooms, family room, etc., to purchase furniture or acquire the necessary equipment.

The second visit is ideally scheduled two to three days before the property handover. Its main purpose is to check if the ​property is in good condition, whether the CHATTELS included in the contract price are still present, and if there is any damage ​or alteration.

8.

Property Closing

A day or two before the property handover, the lawyer will notify the ​buyer to prepare the down payment and other fees for purchasing the ​property, and to go to the lawyer's office to make the payment. Other ​fees include land transfer fees, property taxes, lawyer's fees, etc. ​Typically, the lawyer will provide a detailed list and instruct the buyer to ​obtain a bank draft from the bank according to the amounts specified ​on the list. During the meeting between the buyer and the lawyer, the ​lawyer will explain each item on the list and address any legal questions ​the buyer may have.

On the day of the property handover, the lawyer will dispatch ​representatives to handle all payments, land registry registration, ​property transfer procedures, etc.

Buyers usually obtain the keys after 3 or 4 in the afternoon.

9.

After Closing

1. Conduct a home inspection as soon as possible. In addition to reviewing the considerations from the RE-VISIT, check if ​there are any dents or damage to the interior walls and if the seller has left any garbage behind. If these issues are ​identified, contact the lawyer promptly.

2. Some lawyers may help buyers call utility companies to inform them of the change in ownership. After a successful ​handover, buyers should promptly call utility companies for water, electricity, gas, and hot water heater to confirm the ​change.

3. If the roof, furnace, air conditioner, etc., are nearing the end of their lifespan, consider updating them promptly. If there is ​insufficient attic insulation, address it as soon as possible. For leased water heaters approaching a certain age, notify the ​leasing company for a free replacement.

4. For significant renovations such as replacing windows, flooring, roof, furnace, central air conditioning, etc., make decisions ​and plans early. It's best to have everything sorted before moving into the new residence.

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