April 27, 2012

Live Within Your Means

First-time buyers should do homework before taking plunge

According to recent RBC Royal Bank research, 67 per cent of Canadians between the ages of 18-34 are looking to purchase their first home within the next two years. “Buying your first home is one of the biggest life decisions you will ever make and you want to be both financially and emotionally prepared,” said Melissa Jarman, director of client strategies for RBC. “While you may qualify for a maximum mortgage amount, you should also consider how it will impact your lifestyle.”

Jarman provides the following tips for getting started:

  • Know how much you can afford —Before beginning your house search, take time to review down payment options, household income, current debt, estimated monthly housing-related costs and closing costs. An online calculator can help determine how much you can afford at www.royalbank.com/mortgageaffordability
  • Work with a budget — Budgeting and setting a maximum amount on how much you are willing to spend are key to ensuring you can buy your first home and still live within your means. Online budgeting tools such as myFinanceTracker (www.rbcroyalbank.com/myfinancetracker) can help determine exactly where your money is going and how much you have to spend.
  • Do your research — Friends, family members and online websites can offer you helpful tips. Also, consider reaching out to an RBC mortgage specialist who can give you insights into your finances. This link may be helpful: https://mortgage.rbc.com

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