By familiarizing yourself with these homebuying basics, you’ll be better equipped to make informed decisions and a wise investment.

The length of time allotted to paying off a loan – in homebuying terms, the mortgage. The maximum mortgage amortization period is 25 years for CMHC insured mortgages and 35 years for non-CMHC insured mortgages

In a balanced market, there is an equal balance of buyers and sellers in the market, which means reasonable offers are often accepted by sellers, and homes sell within a reasonable amount of time and prices remain stable

A short-term loan designed to “bridge” the gap for homebuyers who have purchased their new home before selling their existing home. This type of financing is common in a seller’s market or when life events happen and affect timing, allowing homebuyers to purchase without having to sell first

In a buyer’s market, there are more homes on the market than there are buyers, giving the limited number of buyers more choice and greater negotiating power. Homes may stay on the market longer, and prices can be stable or dropping

This is the last step of the real estate transaction, once all the offer conditions outlined in the Agreement of Purchase and Sale have been met and ownership of the property is transferred to the buyer. Once the closing period has passed, the keys are exchanged on the closing date outlined in the offer.

The costs associated with closing the purchase deal. These costs can include legal and administrative fees related to the home purchase. Closing costs are additional to the purchase price of the home.

A Comparative market analysis (CMA) is a report on comparable homes in the area that is used to derive an accurate value for the home in question.

The home inspection is performed to identify any existing or potential underlying problems in a home. This not only protects the buyer from risk, but also gives the buyer leverage when negotiating a purchase price.

A form of ownership whereby you own your unit and have an interest in common elements such as the lobby, elevators, halls, parking garage and building exterior. The condominium association is responsible for maintenance of building and common elements, and collects a monthly condo fee from each owner based on their proportionate share of the building

This term refers to conditions that have to be met in order for the purchase of a home to be finalized. For example, there may be contingencies that the mortgage loan must be approved or the appraised value must be near the final sale price.

An up-front payment made by the buyer to the seller at the time the offer is accepted. The deposit shows the seller that the buyer is serious about the purchase. This amount will be held in trust by the agent or lawyer until the deal closes, at which point it is applied to the purchase price.

The down payment is the amount of money paid-up front for a home, in order to secure a mortgage. In Canada, the minimum down payment is 5% of the home’s total purchase price. Down payments less than 20% of a home’s purchase price require mortgage loan insurance. The selling price, minus the deposit and down payment, is the amount of the mortgage loan.

The difference between a home’s market value and the amount owed on the mortgage. This is the portion of the home that has been paid for and is officially “owned.”

A fixed-rate mortgage guarantees your interest rate for a predetermined amount of time

A form of ownership whereby you own the property and assume responsibility for everything inside and outside the home

A high-ratio mortgage is a mortgage where the borrower has less than 20% of the home’s purchase price to make as the down payment. A high-ratio mortgage with a down payment between 5% and 19% of the purchase price requires mortgage loan insurance. In Canada, 5% is the minimum amount required for the down payment.

A qualified professional provides a market value assessment of a home based on several factors such as property size, location, age of the home, etc. This is used to satisfy mortgage requirements, giving mortgage financing companies confirmation of the mortgaged property’s value.

This is a non-refundable federal income tax credit on a qualifying home, providing tax relief to assist first-time buyers with purchase related costs.

A federal program allowing first-time homebuyers to withdraw funds interest-free from their Registered Retirement Savings Plan (RRSP) to help purchase or build a qualifying home. The borrowed amount must be repaid within 15 years to avoid paying a penalty.

A land survey will identify the property lines. This is not required to purchase a home, but it is recommended and may be required by the mortgage lender to clarify where on the property the owner has jurisdiction. This is important if issues arise between neighbours or the municipality, should the owner wish to make changes in the future such as installing a pool, fence or other renovations involving property lines.

In a seller’s market, there are more buyers than there are homes for sale. With fewer homes on the market and more buyers, homes sell quickly in a seller’s market. Prices of homes are likely to increase, and there are more likely to be multiple offers on a home. Multiple offers give the seller negotiating power, and conditional offers may be rejected.

The home-buying process completed by means of technology in place of face-to-face contact. Some common digital tools include 360 home tours and video showings, video conference calls, e-documents, e-signatures and e-transfers.

This is the tax payable by the buyer to the province and/or municipality in which the transaction occurred upon transferring land. The amount varies depending on the region, the size of the land and other factors.

If your down payment is less than 20% of the purchase price of the home, mortgage loan insurance is required. It protects the lender in case of payment default. Premiums are calculated as a percentage of the down payment, changing at the 5%, 10% and 15% thresholds.

A mortgage pre-approval helps buyers understand how much they can borrow before going through the mortgage application process. Allows you to make an immediate offer when you find a home, since you know how much you’ll be approved for this lender, and locks in the current interest rate for a period of time, insulating you against near-term rate increases.

Title insurance is a policy designed to protect both yourself and your mortgage lender from financial loss or damages caused by potential title defects such as code violations or legal complications. Requirement of title insurance varies, so check with your RE/MAX agent for more information regarding your specific situation

An offer is a legal agreement to purchase a home. An offer can be conditional on a number of factors, like financing or the home inspection. If the conditions are not met, the buyer can cancel their offer.

Transferring your mortgage (and the existing interest rate and terms) from one property to another.

You've heard it before: buying a home may
be the largest purchase you will ever make.
Does that make you nervous? Consider this:
it can also be one of the best investments
you will ever make. 

There are lots of things a potential buyer can do to get
a feel for a property by simply utilizing the tools that are
available online. Your RE/MAX agent is a great resource
to lean on, as they often have lots of information on the
property that may not be included in the MLS listing
description...

When you're ready to make an offer, your RE/MAX
agent will prepare the required paperwork and
negotiate the purchase price and terms on your
behalf, but there are a few things you'll need to
do as well...

As a homebuyer, you can expect to see an array of different home
styles and designs. You've got the choice of single-family, condo,
townhome, lakefront, acreage, luxury; you can also choose bungalow,
multiple-story or split-level. In addition, you can choose a pre-existing
home or new construction. In other words, you've got options...