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4 Things You Need to Know When Buying a House in Surrey

4 Things You Need to Know When Buying a House in Surrey

Buying your first home is an exciting milestone, but it can also be daunting if you're not well-prepared. To make the process smoother, here are four essential things you need to know when buying a house in Surrey:

1. Down Payment Rules

Understanding down payment rules is crucial. In Surrey:

• For homes under $500,000: You need at least a 5% down payment.

• For homes over $500,000: A minimum of 10% is required.

If your down payment is between 5% and 19.99%, you'll need to pay mortgage default insurance, which ranges from 2% to 4% of the loan amount. This insurance safeguards the lender in case you fail to repay your loan.

Why It's Important: A higher down payment lowers your mortgage amount, reducing monthly payments and total interest paid over time.

Saving Tips:

• Create a Budget: Track income and expenses to identify savings opportunities.

• Separate Savings Account: Keep your down payment savings distinct from other funds.

• Cut Unnecessary Expenses: Reduce discretionary spending to save more effectively.

2. Credit Score Requirements

Your credit score significantly impacts your mortgage approval. In Surrey:

• First-time homebuyer lenders: Accept scores from 300 to 900.

• Banks: Typically require a minimum score of 680.

A higher credit score leads to easier loan approval and better interest rates.

Improving Your Credit Score:

• Pay Bills on Time: Avoid late payments.

• Reduce Debt: Lower your debt-to-income ratio.

• Avoid New Credit Accounts: Minimize hard inquiries on your credit report.

• Check Your Credit Report: Dispute any inaccuracies to improve your score.

3. Get Pre-approved for a Mortgage

Getting pre-approved for a mortgage is crucial before house hunting. It provides a clear understanding of your budget and demonstrates to sellers that you are a serious buyer.

Benefits of Pre-approval:

• Sets a Budget: Focus on homes within your price range.

• Strengthens Your Offer: Sellers prefer pre-approved buyers.

• Speeds Up Closing: Expedites the mortgage approval process.

Steps to Get Pre-approved:

1. Gather Financial Documents: Collect income statements, tax returns, and debt information.

2. Choose a Lender: Research lenders and mortgage brokers for competitive rates.

3. Submit an Application: Complete the pre-approval application.

4. Review Your Pre-approval Letter: Understand the loan amount, interest rate, and terms.

4. Understand Your Affordability

Knowing your affordability is crucial. Combine your pre-approval amount with your down payment to determine your maximum purchase price. However, avoid stretching your budget too thin.

Consider All Costs:

• Property Taxes: Vary by location and impact monthly payments.

• Insurance: Necessary to protect your investment.

• Maintenance and Repairs: Ongoing costs for upkeep.

• Utilities and HOA Fees: Include these in your budget.

Creating a Budget:

1. List Monthly Expenses: Include mortgage, taxes, insurance, utilities, and maintenance.

2. Factor in Savings: Allocate for emergencies and future repairs.

3. Plan for Additional Costs: Consider moving, furnishing, and potential upgrades.

Know First-time Home Buyer Grants

To make homeownership more affordable, the Canadian government provides several incentives and grants for first-time homebuyers. Some programs are unique to the province you plan to buy in. Here are a few you can apply for to save money:

• First-time Home Buyer Incentive: A shared equity mortgage with the government.

• Home Buyer’s Tax Credit (HBTC): A non-refundable tax credit for purchase costs.

• Home Buyers’ Plan: Withdraw up to $35,000 from RRSPs for buying a home.

• GST/HST New Housing Rebate: Rebate on part of the GST or HST paid for a new home.

• Provincial Programs: Additional incentives available in Surrey.


Buying a home in Surrey is a significant decision requiring careful planning. Understanding down payment rules, credit score requirements, getting pre-approved for a mortgage, and knowing your affordability are key steps for a smooth process. Take advantage of first-time homebuyer grants to make your dream of homeownership more affordable. For personalized guidance, consider working with an expert real estate agent Jag Sidhu to navigate your journey to becoming a homeowner.