BUILDING YOUR TEAM

You'll need input from your immediate family - I want my own room!  You'll get the inevitable but often useful advice from relatives and friends. And you'll want to have a team of professionals at your service when buying your home. You decide exactly who is on your team, but there are a few professionals without whom buying a home is nearly impossible. For example, just about every home buyer needs a mortgage, so you'll have to find a lender. Also, It's a practical and useful idea to have a lawyer (or notary in Quebec) to protect your interests. Friends, family or other professionals may be able to refer names to you. 

WHAT TO EXPECT FROM YOUR TEAM MEMBERS 

Real Estate Representatives

A good real estate representative should be able to save you time and trouble.  You can deal with the vendor's real estate agent or you can enlist one to work on your behalf. There is no charge to you if the real estate representative takes his or her commission from the vendor. If, however, you wish a salesperson to act exclusively for you, there may be a cost involved. Make sure you are clear on who is paying the real estate representative and you understand your obligations once you've signed an agreement.  

When discussing your needs with a representative, be as specific as possible about the kind of home you' re looking for and your price range. If you're not certain, set aside some time for your representative to help you determine these.  

He or she will know what is on the market, in which neighborhoods and at what price, and can save you time by prescreening home listings - screening out the ones that don' t meet your needs or budget. Then he or she can make appointments for you to see the homes that suit you. 

If you're looking for a country home, an urban condominium specialist is not the right real estate representative. 

A real estate representative can also assist you in making an Offer to Purchase. Representatives are aware of current market conditions, what price offers are realistic and what conditions to include in any offers. It is very advisable to have any offer or contract reviewed by your solicitor prior to you signing anything. You may also wish to add a clause in a contract allowing for a satisfactory home inspection.  

Builders / Contractors

You may deal with a builder or contractor if you buy a new home, have one custom built or require renovations to a resale home. To ensure a builder' s credibility and quality, ask for references, talk to other customers about the builder' s work (actual residents in neighbouring homes), check with the Ottawa Construction Association, Better Business Bureau or check with the Ontario New Home Warranty program. (all have links from our "Web Links" page)

If you're buying a new home from a developer or builder, visit other housing developments that the company has built. You can also ask builders or contractors if they are a member of a local home builders' association, or ask for a provincial license number to ensure your contractor is registered.  

A good way to start looking for any professional is to ask for referrals from satisfied friends. Another inexpensive way is to walk around developments and actually knock on a few doors. Most homeowners will openly discuss the good and bad aspects of their home as well as any dealings that they may have had with their builder. It's amazing how many homeowners claim that they would not have purchased from their particular builder, had they talked to a few neighbours first!

If you' re building a custom home, you may also want to hire an architect. Standard architect' s fees are 10% of the total project cost. Builders of custom homes and renovators usually work on either a fixed-price or a cost-plus formula. Your contract should outline what the payment type is. All contracts with a builder should be as specific as possible about construction details, right down to the brand name or model number of any finishes. Most contracts from builders are heavily weighed in their favour. You will definitely want to have your contract reviewed by your lawyer before signing it, to ensure that all of your concerns have been addressed and your interests protected. Your lawyer may also suggest that you include a clause that allows for progressive home inspections by a qualified home inspector, during the construction process. Any changes to your contract should be initialed by you. 

Appraisers

You may wish to have an independent appraisal completed on a property before you make any offer or make the offer conditional on completion of an appraisal. It may also be a necessary requirement of your lending institution if you are arranging for a mortgage.  It can protect you from paying more than the market value. If the appraised value is lower than the agreed price, you may be able to renegotiate a lower price, therefore having an independent appraisal could save you time and money. 

The appraisal will include an unbiased assessment of the property's physical and functional characteristics, an analysis of recent comparable sales and an assessment of current market conditions affecting the property. This information provides you with an expert independent opinion as to the property's market value. An appraisal however, is not a home inspection and should never be considered as such. Most home appraisals are completed solely by the appraiser and take less than an hour. A home inspections is completed in your presence and may take several hours depending on the size and age of the property 

Lenders

The key to finding the right lender is to shop around. Many different institutions lend money for mortgages, including banks, trust companies, credit unions, caisse populaires, pension funds, insurance companies and finance companies.

You can even find private lenders listed in your local newspaper. It will save you money to speak with more than one lender in each category because the terms and options of each will vary. 

Some lenders, such as credit unions, deal only with members. But don' t be shy about approaching new institutions. For example, if you' d like to get your mortgage at a trust company, you don't need to have a savings account there.  It is always a good idea to ensure that you have a mortgage pre-approval before you go house hunting. In times of interest rate instability this may allow you to "lock-in" an interest rate for a period while you are shopping for your new home. Having a pre-approval may also avoid disappointment or wasted time in looking for homes that you may not be able to afford. 

Mortgage Brokers

Mortgage brokers don't usually lend money but rather put you in touch with others who do.  For example, brokers are aware of private lenders that you may not be able to find on your own. 

Brokers are independent, which means that they are not affiliated with any specific lending institutions. Their role is to find the lender with the terms and rates that will best suit you. Be warned however, that many brokers charge "fees" for their services. 

Lawyers/Notaries

Hiring a lawyer (or notary in Quebec) is one way to ensure that your legal interests are being protected when you buy your home. Your lawyer will review any contracts you need to sign, especially the Offer to Purchase. Lawyers are like most professionals and may specialize in certain areas of the law. It is often recommended that you find a "real estate specialist" rather than someone in a general legal practice. This may be especially true, if you are purchasing from a builder. 

If you make an Offer to Purchase that is accepted, your lawyer will be responsible for many of the closing arrangements. 

Lawyers' fees range widely and depend on the complexity of the deal, but will probably cost a minimum of $800 plus disbursements. 

You can check for a lawyer referral service in your community or call the local law association for the names of lawyers who specialize in real estate law. 

Home Inspectors

It is always a good idea to have the home inspected.  The cost to do so is very small considering the size and price of your investment. 

An inspector should supply a detailed written report on how well built the home is, and whether any repairs are necessary and their estimated cost. The report should estimate the cost of repairs and the priorities - what should get fixed first and how soon. 

You can find a home inspector through a professional association of home inspectors such as OAHI – The Ontario Association of Registered Home Inspectors at http://www.oahi.com

Inspectors are unregulated in most provinces, so you should inquire about the inspector's credentials and ask for references. 

Home inspectors' fees can generally range from $300 - $500 for an average size home. Most good inspectors are in demand and require 3-5 business days notice. 

Insurance Brokers

An insurance broker can provide you with all your insurance needs, including property insurance and mortgage life insurance. Lenders insist on property insurance because your property is their security for your loan. Property insurance covers the replacement cost of your home, so premiums vary depending on your home' s worth. 

Ask them to specify precisely what services you are getting and how much they will cost. 

Your lender may also suggest that you buy mortgage life insurance. This is often available through your lender, who then simply adds the premium to your regular mortgage payments. 

But lender-supplied insurance can be more expensive than from a broker. Don' t confuse property or life insurance with mortgage loan insurance which is mandatory for high-ratio mortgages.  

Movers

Often taken for granted, a smooth move can make an otherwise hectic closing day bearable.  Many movers offer specialty-packing boxes that you can purchase and pack yourselves.  Often however, they will not be responsible for breakage of articles that you pack yourselves. 

Often the care and transport of valuable items is best left to the professionals. Having a good group of friends move your possessions may save you money up front but may prove to be a hard experience on the furniture and often with incident. 

Make certain that all boxes are clearly labeled by room. Ensure that you pack a box of essentials such as medications, toiletries and cleaning items– label it open me first and ask the movers to pack it last.

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