Think you need two incomes to buy a home in Calgary? Think again! I have worked with many first-time Buyers who have comfortably purchased their first home with only one income. Here are some of the ways they made it work.
Pay down debt
The less you owe to debt, the more likely you are to be approved for a mortgage. As much as possible, pay down outstanding debt and make a plan to continue your debt repayment even after you have assumed a mortgage. A financial planner can help you put together a realistic plan that works for your circumstances.
Use a Mortgage Broker
Using a great mortgage broker can help you to understand exactly how much house you can afford and they can help you secure an interest rate and repayment schedule that works for you and your budget.
Have a down payment
The bigger your down payment, the more likely you are to be approved for a mortgage. You can save up for a down payment, borrow from your RRSP or TFSA under the federal government’s Home Buyers’ Plan, or secure a personal loan from a family member.
Insure your income
If you are a single income household, talk to a financial planner about insuring that income. There are a wide range of income protection insurance products on the market that are affordable and customizable. This is a great way to show lenders that you can continue to pay back your mortgage loan even if you fall ill or are temporarily unemployed.
Become a Homeowner and Landlord at the same time
If you are comfortable with the idea of being a Landlord, look for properties that would also be desirable to tenants. You could consider a condo that has a separate bedroom and bathroom for a tenant. Or you could look at properties that include a legal basement suite that you can rent out. This will help you to cover mortgage expenses and can relieve some of the financial burdens of being a homeowner.
With a good plan and a great Realtor, home ownership is possible for single income households. If you would like to learn more about my experiences helping people buy a home on a single income, please do not hesitate to contact me. I would love to help you find your pathway home.