Buying your first home is an exciting milestone involving several necessary steps. Here's a step-by-step process for first-time homebuyers, with a focus on what's relevant in Ontario, Canada:

Phase 1: Getting Ready Financially

1. Assess Your Financial Situation and Budget:

   • Review income, expenses, debts, and savings. Get a clear picture of your current financial health.
   • Check your credit score. A good credit score (typically 620+ for most lenders) is crucial for mortgage approval and securing favourable interest rates. You can get a free credit report annually from Equifax or TransUnion.
   • Determine what you can realistically afford for monthly mortgage payments. Remember to factor in not just the principal and interest (P&I), but also property taxes, home insurance (PITI), and potential condo fees or HOA fees.
   • Budget for additional costs beyond the purchase price, such as closing costs (1.5% to 4% of the purchase price is a reasonable estimate), potential repairs/renovations, and moving expenses.

2. Save for Your Down Payment and Closing Costs:

   • Down Payment: This is the portion of the home price you pay upfront.
     • The minimum down payment for homes $500,000 or less is 5%.
     • For homes between $500,000 and $999,999, it's 5% on the first $500,000 and 10% on the remaining amount.
     • For homes $1 million or more, the minimum is 20%.
     • If your down payment is less than 20%, you will typically need mortgage default insurance (also known as CMHC insurance in Canada), which is an additional cost.
   • Closing Costs: These are one-time fees paid when you finalize the home purchase. They can include:
     • Legal fees
     • Home inspection and appraisal fees
     • Land Transfer Tax (LTT) - First-time homebuyers in Ontario may be eligible for a refund of up to $4,000 on the provincial LTT. If you're buying in Toronto, you may also be eligible for an additional Municipal Land Transfer Tax (MLTT) rebate of up to $4,475.
     • Title insurance
     • Adjustments (e.g., property tax adjustments)
     • GST/HST (for new builds) - First-time homebuyers may be eligible for a GST/HST New Housing Rebate.

3. Explore First-Time Home Buyer Programs and Incentives (Ontario/Canada):

   • Home Buyers' Plan (HBP): Allows you to withdraw up to $60,000 (per person, so $120,000 for a couple) tax-free from your Registered Retirement Savings Plan (RRSP) for a down payment. You have 15 years to repay it, starting two years after the withdrawal.
   • First Home Savings Account (FHSA): A new account that allows you to save up to $8,000 per year (lifetime maximum of $40,000) tax-free for your first home. Contributions are tax-deductible, and withdrawals for a qualifying home purchase are tax-free.
   • First-Time Home Buyers' Tax Credit (HBTC): A non-refundable federal tax credit of $1,500 to help offset closing costs.
   • Ontario Land Transfer Tax Refund: As mentioned above, first-time homebuyers can receive a refund of up to $4,000 on the provincial Land Transfer Tax.
   • Municipal Land Transfer Tax Rebate (Toronto only): If buying in Toronto, you may be eligible for an additional rebate.
   • Local Homeownership Programs: Some Ontario municipalities offer assistance programs (e.g., down payment loans). It's worth researching what's available in Kawarthas.

Phase 2: Getting Pre-Approved and Finding Your Home

4. Get Mortgage Pre-Approval:

   • This is a crucial step before you start house hunting. It tells you how much a lender will lend you and at what interest rate (often locked in for 90-120 days).
   • Gather necessary documentation: proof of income (pay stubs, T4s, Notice of Assessment), proof of down payment (bank statements, investment statements), and details of existing debts.
   • You can meet with a mortgage advisor at a bank or a mortgage broker. A mortgage broker can shop with multiple lenders to find the best rates and terms.

5. Find a Real Estate Agent:

   • Interview a few agents to find someone experienced and knowledgeable about the local market (Peterborough) who understands your needs.
   • A good agent will help you navigate the process, find suitable properties, negotiate offers, and handle paperwork. The seller typically pays their fees.

6. Begin House Hunting:

   • Based on your budget and preferences, start looking at properties. Consider factors like:
     • Location: Proximity to work, schools, amenities, safety, and growth potential.
     • Type of Home: Detached, semi-detached, townhouse, condo, etc.
     • Size: Number of bedrooms/bathrooms, square footage, lot size.
     • Age and Condition: Do you want a move-in-ready home or a fixer-upper? Factor in potential renovation costs.
     • Resale vs. New Build: Each has pros and cons.
   • Create a "wants vs. needs" list to help narrow your search. Be prepared to visit several homes.

Phase 3: Making an Offer and Closing the Deal

7. Make an Offer:

   • Once you find a home you like, your real estate agent will help you draft a competitive offer.
   • The offer will include the purchase price, closing date, and "conditions." Common conditions include:
     • Home Inspection: This is highly recommended to uncover any potential issues with the property. Do not skip this, even in a competitive market.
     • Financing: Contingent on you securing final mortgage approval.
     • Appraisal: The lender will likely require an appraisal to ensure the home's value aligns with the purchase price.

8. Obtain Final Mortgage Approval:

   • Once your offer is accepted, your lender will finalize your mortgage. They will review the accepted offer, the home inspection report, and the appraisal.

9. Complete a Home Inspection:

   • Arrange for a qualified home inspector to thoroughly assess the property for any structural issues, maintenance needs, or potential problems. This helps you understand the home's condition and can be a basis for renegotiating the price or requesting repairs.

10. Work with a Real Estate Lawyer/Notary:

    • Your lawyer will conduct a title search (to ensure clear ownership), prepare all legal documents, handle the funds transfer, and register the home in your name. They will also advise you on closing costs and ensure all conditions are met.

11. Close the Deal:

    • On closing day, your lender provides the mortgage funds to your lawyer. You provide your down payment (minus any deposit) and closing costs to your lawyer.
    • Your lawyer pays the sellers and registers the home in your name.
    • You receive the keys to your new home!

Phase 4: After You Buy

12. Set Up Utilities and Home Insurance:

    • Contact local utility providers (hydro, water, gas, and internet) to transfer services into your name.
    • Secure home insurance before closing, as it's typically required by lenders.

13. Change Locks and Address:

    • It's a good idea to change the locks on your new home for security.
    • Update your address with Canada Post, Service Canada, and other relevant institutions.

14. Budget for Ongoing Costs and Maintenance:

    • Remember that homeownership involves ongoing expenses like property taxes, utilities, insurance, and maintenance. Set aside funds for unexpected repairs and regular upkeep.

This step-by-step process should provide a comprehensive guide for your first home purchase in Ontario. Good luck!