How to balance your mortgage payments with your lifestyle

Roozbeh - Senior Account Manager

With the purchase of a new property there are a lot of things for you to consider. For example, property taxes, condo fees, maintenance of your lawn if you're in a house.

Those are the kind of things that if you're renting you're probably not paying out.

So it's very important for us to realize what those extra costs are and to find out what is the right balance between having your property and maintaining the lifestyle that you're comfortable with because your financial situation is very unique.

At Royal Bank we can help you find out what that right balance is and how we can help you enjoy your property over a long period of time.

It is important to realize that with what you're about to take on with the purchase of your new property, it is a long term plan and your budget and your lifestyle would change through time.

For example marriage, having a newborn or even a new job, and with a new child in your family, you may have a reduction in income because your spouse might be on a maternity leave, or extra expenses on things like daycare or diapers. We need to make sure that we plan for those kind of things.

With all this in mind you can find the right balance of having a mortgage payment that you're comfortable with. You could either pop in online and play around with some of the numbers that may give you an indication of how much you can afford or you can come into the branch, go through the calculator together, and at the same time have a look at doing the pre-approval for you to make sure that everything is set in place when you're looking to find that ideal property for yourself.

For more information, please visit the RBC Advice Centre

Here are some points to consider when deciding whether to rent or to buy a home.

Rohan - Account Manager

Purchasing a home is a big decision, and it is important to take the time to understand if you are ready to make the move from renting to buying your home. It is a personal decision and there are many factors to consider that are unique to you. Owning a home will most likely be the biggest investment in your lifetime.

The earlier you can re-direct your rent payments into a mortgage payment the faster you will start building equity in your home. Equity is the difference between the value of your home and the amount you owe on your home, and as you pay down your mortgage, or the housing market changes, your equity has the opportunity to grow.

But this doesn't mean that home ownership is the right fit for everyone. If your move is short term, or you are not sure yet of where you want to live it may be worthwhile to continue to rent. Owning a home is a long term commitment.

On our website we have a rent or buy tool that you may want to take a look at to understand what your current rent payment would equate to in a mortgage amount. For example:

If you are currently paying $1000 a month in rent, based on today's 5 year interest rate, amortizing the full amount of your mortgage over 25 years, and making a 10% down payment, this could equate to a house valued at close to $200,000.

It is important to keep in mind as a homeowner there are extra costs you need to account and budget for which may include: property taxes, property maintenance costs, utilities, and condo fees.

Weigh the pros and cons and determine when you are personally ready to make the move from renting to buying. If you are ready, or need help to determine if now is the right time for you, contact one of our RBC Mobile Mortgage Specialists to help you work through the numbers.

For more information, please visit the RBC Advice Centre.