Sun | Dec 17, 2017

A Matter of Land | We want to buy our first home, what do we do? - Pt 2

Published:Sunday | November 5, 2017 | 12:00 AM

Today our guest columnist, mortgage specialist Cassandra Francis, continues her response to a question from a reader. Here is a repeat of the question and part two of the answer.

Good day Mr Francis,

I read your articles most weeks and I find them very informative, helpful and entertaining at times.

I now need your advice and would really like to hear from you. The situation is that my husband and I are interested in buying a property.

What we want to know is:

- How do we go about this?

- What is our first step to achieving this goal?

- How do we know how much monies we can get from a particular institution?

- What are the steps we take to owning our first home?

I look forward to your response.

- R.H.

Last week, I dealt with the preapproval process. this week, I want to look at the other aspects to home/property ownership.

After you have received the preapproval letter you can start your house or property hunting, as you now know your spending power and a letter from an institution that says it is willing to lend you a particular amount.

A realtor or vendor is now confident that you are able to purchase what it is that you want, as they now see what you are able to get from a particular lending institution.

So the search for your ideal property is your next step. As soon as the realtor or you find a property that you want there are some other steps that need to be taken.

First, you should ensure that you see a copy of the Certificate of Title to ensure that the vendor selling the property is authorised to do so. In the event of a housing development this may be waived as the splinter titles may not be yet available.

For all other instances, ensure that the rightful owner or someone so appointed is selling the property. This can be known from the title. If you use a realtor they would have checked this out for you already.

After you are satisfied with the legitimacy of the vendor then you can start doing business with them. However, before you make any deposit on the property consult an attorney to look at the draft agreement for sale presented to you by the vendor.

When your attorney gives the green light, then you may make your deposit at that time.

 

What is the standard deposit?

 

The standard deposit is 15 per cent; however, this amount may vary depending on the vendor and the lender.

In some instances, the vendor may require more than the standard amount so you may need to come up with more cash up front.

In some instances, you can make a deposit of five per cent as you may be able to get 95 per cent loan from the lending institution.

 

Documents required for the mortgage application

 

After you have made your deposit and have a signed sales agreement, then you see a mortgage specialist with the sales agreement, then you will be instructed to complete a mortgage application form.

 

Salaried applicants

 

- Income verification letter and last two pay advices

 

Self-employed

 

- financial statements (audited) and bank statements.

- Proof of funds to complete the transaction.

- Proof of age (valid passport/birth certificate).

- Tax Registration Number (TRN).

- Contractors' estimate (home construction/improvement).

- Original surveyor's Identification Report not more than 12 months old by a commissioned land surveyor.

- Original copy of Valuation Report by an approved land valuator.

- Photocopy of Certificate of Title.

- NHT commitment letter (where applicable).

- Property Tax Certificate.

- Approved building plan (where applicable).

- Quantity Surveyor's Report (where applicable).

- Evidence of strata coverage (where applicable).

As soon as the mortgage specialist has these documents he/she will go about getting approval for your loan in the quickest possible time. Often as quick as 10 days.

Until next time, traverse well.

- If you have any queries or questions, you can contact Cassandra Francis at

cindifrancis@gmail.com or 1-876-276-5360