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Home Buying

Affordability, closing costs, refinancing, mortgage planning, and the full first-time-buyer roadmap.

6 resources

About Home Buying

Buying a home is the single largest financial decision most households make. This section covers the full journey: how much house you can responsibly afford using the traditional 28/36 underwriting rule, what closing costs actually run in your state or province, when refinancing pays off and when it does not, and how to track amortization and equity over the life of the loan. The tools handle US and Canadian markets side by side, including the major US programs (FHA, VA, USDA, Fannie HomeReady, Freddie Home Possible) and Canadian programs (CMHC default insurance, RRSP Home Buyers' Plan, FHSA, provincial land-transfer-tax rebates). For first-time buyers especially, the math here can save or cost tens of thousands.

Tools 2

Closing Cost Calculator (US + Canada) Estimate the full closing cost bill for buying a home: loan origination, title and legal fees, government fees, prepaids, and provincial land-transfer tax, with first-time-buyer rebates auto-applied. Models the Ontario sliding LTT (and the Toronto municipal double), BC's Property Transfer Tax with the first-time-buyer exemption, Quebec's welcome tax, the zero-LTT advantage in Alberta and Saskatchewan, Atlantic deed transfer taxes, and US national-average closing costs by loan type (Conventional, FHA, VA).
Home Affordability Calculator (28/36 Rule, US + Canada) Find the maximum home price you can responsibly afford from your income, monthly debts, down payment, and current mortgage rate. Uses the 28/36 traditional underwriting rule with Conservative, Standard, and Stretch stances, estimates property tax and insurance, handles PMI (US) vs CMHC (Canada) for under-20% down payments, and warns when your debt load would make you house-poor.

Guides 2

How to Prepare Financially to Buy a House (US + Canada) The 6-month financial runway before making offers: credit-score cleanup by FICO band, pre-qualification vs pre-approval, down payment math (20% vs 10% vs 5% vs FHA 3.5%), the full cost of ownership, US programs (FHA, VA, USDA, HomeReady), Canadian programs (CMHC, RRSP Home Buyers' Plan, FHSA, provincial land-transfer-tax rebates), and the first-time-buyer mistakes that cost tens of thousands.
When to Refinance Your Mortgage: The Breakeven Math (US + Canada) When refinancing pays off and when it doesn't: the breakeven calculation (closing costs divided by monthly savings), why the 1.5 to 2% rate-drop rule isn't actually a rule, rate-and-term vs cash-out, the no-cost refinance trap, cash-out vs HELOC vs personal loan, and the Canadian Interest Rate Differential penalty that surprises mid-term refinancers, plus the renewal-vs-refinance distinction every Canadian borrower should know.

Printables 2

Home Buying Readiness Checklist (6-Month Countdown) Printable 6-month home-buying countdown: T-180 credit and savings audit, T-120 debt paydown, T-90 pre-qualification, T-60 pre-approval documents, T-30 offers, T-14 inspection and appraisal, T-7 walkthrough, closing day. Plus a neighborhood comparison worksheet, US and Canadian first-time-buyer program quick reference (FHA, VA, USDA, CMHC, RRSP HBP, FHSA, LTT rebates), and a closing-cost reference card.
Mortgage Amortization Tracker (Multi-Year Payment Log) Print this multi-year mortgage log to track payments year over year: principal vs interest split, extra-principal payments, refinance events with breakeven, equity growth, and a quick-reference card with P&I per $1,000 borrowed by rate.

Frequently asked questions

How much house can I actually afford?

The traditional underwriting rule is 28/36: monthly housing costs should not exceed 28% of gross monthly income, and total monthly debt payments (housing plus everything else) should not exceed 36%. Most banks will approve up to this ceiling, but living at the ceiling is what makes people house-poor. The Home Affordability Calculator lets you see what the 28/36 standard, 25/33 conservative, and 32/40 stretch caps all give you for the same income and down payment.

How much should I plan for closing costs?

In the US, plan 2 to 5 percent of the purchase price for closing costs, including loan origination, title insurance, escrow, recording, transfer tax, and prepaids. In Canada, plan 1.5 to 4 percent plus provincial land-transfer-tax (which varies dramatically: Alberta and Saskatchewan have zero LTT, Ontario charges 0.5 to 2.5 percent on a sliding scale, BC charges 1 to 3 percent, Quebec's 'welcome tax' is 0.5 to 1.5 percent by municipality). The Closing Cost Calculator estimates the full bill including provincial-specific items.

When is refinancing worth it?

Calculate the breakeven: closing costs divided by monthly savings equals the number of months you have to stay in the home to recoup the refinance cost. If you will be in the home longer than that breakeven, refinance makes sense. The traditional rule of thumb is a 1.5 to 2 percent rate drop, but the actual math depends on your remaining balance and remaining term. In Canada, breaking a closed mortgage mid-term triggers an Interest Rate Differential penalty that can run $10,000 to $30,000+ on a typical balance, which often makes refinancing not worth it until renewal.

What is CMHC and do I really need it?

CMHC mortgage default insurance is required in Canada when the down payment is less than 20 percent. The premium is 2.8 to 4.0 percent of the loan amount (the percentage scales with down payment size: 4.0% at 5-9.99% down, 3.1% at 10-14.99% down, 2.8% at 15-19.99% down) and is added to the loan principal rather than billed monthly. This differs from US PMI which is billed monthly and can be removed once the loan-to-value reaches 78 percent. For a $400,000 home with 10% down in Canada, CMHC adds roughly $11,160 to the loan.

What is the FHSA and should I use it?

The First Home Savings Account is a Canadian registered account launched in April 2023. Annual contribution room is $8,000 with a lifetime cap of $40,000. Contributions are tax-deductible (like an RRSP) AND withdrawals for a first home purchase are tax-free (like a TFSA). It is the single best Canadian first-time-buyer savings vehicle and stacks with the RRSP Home Buyers' Plan ($35,000 per person, repay over 15 years) for a potential combined $75,000 first-home withdrawal. Most Canadian first-time buyers should be maxing FHSA contributions before any other savings vehicle.

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