By Chelsea Thornton (Staff Writer)
One thing students might not typically learn in class is how to buy a house. Fortunately, UFV organized a First Time Home Buyers Seminar on Thursday March 31 to help remedy that. Realtor Clarence Jensen, mortgage broker Paul Carman, and financial planner Rudy Teichrob greeted a large crowd with information packets and cupcakes. The seminar covered the home-buying process step by step, and Jensen encouraged all prospective buyers to “Break it down into manageable parts.”
According to the hosts, the first step in the process is getting pre-approval on a loan. Carman emphasized that pre-approval is not final approval; what it actually is is a budgeting tool that tells home hunters what price range to target. The amount of the approval is determined by an assessment of assets, liabilities, and credit references.
The specialists emphasized the importance of a good realtor – actually called a buyer’s agent, if one is buying instead of selling a home. A buyer’s agent should provide customers with loyalty, experience, knowledge, full disclosure, negotiation assistance, and recommendations for other home buying-related services. They also recommended that prospective homeowners work with only one agent, and go to them with any listings or open houses that they wish to investigate.
There are four types of property ownership: freehold, strata lot, cooperative, and lease. Carman recommended attempting to find a home that falls into one of the first two categories. Freehold is the most common type of ownership, and means that the owner has full use and control of the property. A strata lot is a share of common property, and therefore property rights are limited by strata bylaws, rules, and regulations. It is very important when buying a strata lot to check the financial health of the strata, since repairs and upkeep to the property will be paid with strata money.
After finding a property to buy, the next step is making an offer to purchase. The documents required for this include the purchase details, deposit amount, dates of completion, adjustment, possession, and subjects. Subjects are items such as financing, home inspection, insurance, title search, property, disclosure, and strata documents, and the subjects must be removed before the deal goes through.
Say the sellers have accepted the offer. Now the future homeowner must work out financing – namely, the mortgage. To do this, one must have a job letter, two pay stubs, three months of bank statements, and tax forms. Once approved, it is time to choose between a variable or fixed rate mortgage. Typically, a buyer will save money with a variable mortgage, but a fixed mortgage can offer peace of mind through prime fluctuations.
One of the options presented to those mortgaging homes is mortgage insurance, so that if a buyer dies before paying off the mortgage, his/her family will not be left to foot the bill. Teichrob strongly suggested buying personal life insurance worth the value of the mortgage instead. This way, the money is paid out to the homeowner’s family, not the bank, and the value of the policy does not decrease as the mortgage is paid down.
The seminar ended with advice for those considering a career in real estate or mortgages. For either career, the group suggested developing a background in working with people, then going to UBC and taking the appropriate program. These jobs are about “the joy of helping people get where they want to be.”