Worksheet: Home Ownership and what it costs - Fiscal Agents Financial Tools

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Financial Worksheet: Home ownership and what it costs

Figure out how much you'll need for home ownership

Mortgages are by far the largest source of personal debt in Canada. For most of us, mortgage payments are the single largest household expense we encounter, every month, for most of our lives. The average home owner allocates over 32% of his/her lifetime income to paying off mortgage loans.

To help you with understanding the type costs you may encounter. We've prepared this financing guide to help you lay down on paper the implications of purchasing and budgeting for your first home or selling an existing home and buying another.

Calculating how much you can afford.	Step one
To estimate the maximum house purchase price, answer the following questions and enter the results into the corresponding box, the program will do the rest.

Enter your (and co-applicant) gross monthly income (lenders consider 32% of income as housing costs) 0.32 multiply (x) minus (-)
Monthly property taxes
Monthly heating costs
Condo/strata fees (1/2)
Total
Interest rate
Add your cashdown payment
Your affordable house price

How much is it going to cost to move in to your new home?	Step Two
Now that you've worked out how much you can spend on your new home, lets look at how much you'll need before you make the offer to purchase.

	Your $ Estimate	Example
Purchase price of home		$250,000
Lets estimate some of the costs...
Moving		1,500
Appraisal fee		150
Inspection of house fee		250
Property survey (if applicable)		375
Insurer’s application fee (if applicable)		N/A
Home warranty fee (new home)		N/A
Estimated Legal fees
Purchase/mortgage		850
Disbursements		350.
Sub-total		1.200
Land transfer purchase tax (if applicable)		2,100
Interest adjustment		175
Property tax adjustment / School taxes		855
Utility adjustments / Hydro / Water / Oil		125
Property Insurance		475
Immediate repairs (if applicable)		N/A
Appliances, carpets, furnishings, etc.		500
Other		100
Note: costs will vary Add GST
The total amount of purchase		Our example $257,805.00

How much financing do you need ?	Step Three
If you already own a home, then you’ll need to calculate how much equity you have in the property, as this is perhaps the most important source of funds for financing a new one. Using this form will provide a quick way for you to see how much equity you have.

	Your Calculation	Our Example
Selling price of your existing home		$185,000
Sale costs (estimated)
Real Estate commission		11,100
Property survey		375
Legal fees
Discharge of mortgage		N/A
Mortgage outstanding		67,500
Prepayment penalty		1,180
Lender’s processing fee		125
Property tax & utility adjustments		350
Miscellaneous cost		700
The estimated total cost of sale		Our example $81,710
Selling price		$185,000
Cost of sale		$81,710
Equity		$113,290

Now lets find out how much is needed	Step Four
To estimate the maximum house purchase price, answer the following questions and enter the results into the corresponding box, the program will do the rest.

	Your Calculation	Our example
The total purchase cost of the new home		$257,805
Mortgage financing required:
Offer to purchase deposit		$10,000
Cash on hand (Bonds, savings)		$51,500
Estimated equity from existing home		$103,290
To determine the how much you'll need in mortgage financing, subtract the amount of cash and/or equity from the sale of propriety		$83,015

The above mortgage financing guide is intended only to provided to help you estimate your financing requirements. Typically if the estimated mortgage financing exceeds 75% of the purchase price or appraised value of the property, the loan must be insured.

Down payments requirements are 10% or higher of the purchase price, some first time home buyers may qualify for a 5% down payments.
Selecting the right mortgage is just about as important as selecting the right home, choosing the right mortgage is more than choosing an interest rate.

Selecting the right mortgage options / Apply for you mortgage on the net

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