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Dominion LenDing CentreS OUR HOUSE Spring 2017 >> 41 StoCKSY, iStoCK highlights of Homebuying Step By Step » Principles that help buyers determine how much they can safely afford to spend on housing. » A list of the upfront and ongoing costs of homeownership. » Information on how to prepare for a meeting with a lender or broker. » Definitions of key terms to know when buying a home. » explanation of mortgage basics and tips for how to manage your mortgage. » tips on how to maintain your home and protect your investment. What homebuyers should know the guide recommends a homebuyer's monthly housing costs should not exceed 32 per cent of his average gross monthly income. this is also known as the debt-to- income ratio. included in the housing costs are monthly mortgage payments, property taxes, condo fees and heating expenses. a family's monthly debt load, which includes items like car loans and credit card payments, should not exceed 40 per cent of average income, according to the guide. Homebuying Step By Step also offers a short segment on all the documents a homebuyer will need in order to get a mortgage. it suggests a buyer should prepare to meet his lender or mortgage broker by gathering the following documents: personal identification, proof of a down payment, proof of income, proof of savings and investments and details of current debt. CmHC also recommends that people get pre-approved for a mortgage before they start looking for a home. Sources for a mortgage While the guide notes there are many lend- ing sources for mortgages, including banks, trust companies, credit unions and pension funds, it recommends shopping around before making a decision. the guide also suggests that mortgage brokers are a good resource since they can work with more than one lender. to find a lender or broker, the guide advises asking real estate agents, friends or family members for recommendations. Collin Bruce, a DLC mortgage broker based in edmonton, says that the guide is conservative when it comes to lending, but overall the content is a good introduction to new homebuyers. "it's a great first step for somebody. i think [the guide] is very informative and i think it gives a good over- view," he says, pointing out that DLC also has a homebuyers guide he shares with new clients. Bruce notes that the debt-to-income ratio CmHC recommended is conservative, but that's not unexpected from the federal government. He says the section in the guide referring to financial calculations is very detailed, factoring costs many new homebuyers don't think about, like groceries, dining out and hobbies. the underlying theme of the guide, he explains, is to prevent Canadians from getting in over their heads in debt when buying a home. Bruce also notes the various references to mortgage brokers throughout the docu- ment as a positive nod to the industry. "a lot of times it's just banks," he says. "the fact that they're mentioning brokers all the way through [the homebuyers guide] is excellent."

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