Life Rich, Not House Poor

As a soon to be homeowner, there is a big difference between what you are approved for and what you can afford which is a common misconception!

What you are approved for - this is the process of seeing what you can get approval for in the eyes of a financial institution. They look at your credit, income and reported liabilities and give you a general bracket of money they would lend you.

What you can afford - this is when you sit down and review your budget. What are you paying in fundamentals of life (groceries, heat, hydro, rent, car payments, gas etc.) what you are saving for the future (RRSP’s, travel savings, home renovations etc.) and what you spend in your lifestyle bracket (gifts throughout the year, shopping, concerts, dinners out etc.) and see what is left for you to comfortably allot to spending on a mortgage payment.

It may surprise you to know that these numbers aren’t always in line which is why it is so important to work with a professional who will outline what mortgage you are best suited for!