So I am just going to give a short little blurb on utilities. It’s more on planning for them rather than paying them because lucky for me.. I have yet to pay a bill! The good part about the first few weeks in your new house.
So, these are things you need to plan for when you buy your first home. Whether you are moving out from your parents house or moving from an apartment, you will need to switch over/cancel your utilities. Look for the companies that service your area, they should have a service area map on their website to let you know if you are a part of it.
Be prepared to pay a deposit when you sign up for hydro or gas if you are a new customer. If you have been with a company previously – when renting a home or apartment – then you can provide a letter of confirmation from your current company and they will likely waive your deposit. This is very helpful because it can save you a few hundred dollars.
Another option is signing up for preauthorized payments (PAP). Some companies will waive the deposit if you agree to PAP.
Beyond that, the only other piece of information I wanted to share today is in regards to property taxes. If you have not already signed a mortgage agreement with your bank, talk to them about this feature. With the bank that we decided to go with, we learned after the fact that because we paid less than the 20% downpayment, our property taxes are paid with our mortgage payment. If your bank has this policy, you can ask your advisor to submit a request to pay the bills yourself. I am not entirely sure the criteria for approval, other than the amount of money you have in your account and if it is sufficient to cover costs. This is not a Bank of Canada policy, it is a bank policy, so it can vary from bank to bank.
This information is especially useful, because we thought our mortgage was going to be the amount listed on our mortgage agreement shown to us by our advisor. However, when we got our first “bill” in the mail, it was a couple hundred dollars more expensive because of the property taxes included. This came as a not so good surprise to us – and definitely affects how you budget. Also be aware that when you pay the bank your property taxes, you are actually paying more than the annual cost because the bank wants to keep a surplus in their ‘property tax account’ for you to cover any issues past or future.
For us, this has been a hands on learning experience. I am writing to you all today so that you can be more prepared for these additional bills and unexpected costs so you can budget accordingly and not have any ugly surprises. It will definitely ease the financial pain associated with buying your first home.
For now, I believe this sums up my learning process as a first time home buyer. I know when I go to sell my house I will definitely add information as a first time home seller! And I will definitely come back to these articles to remind myself of the buying process.
Going forward I will be adding posts about all of our exciting DIY adventures. That’s another learning process. Everything sounds so easy to do but seems to take 10x longer and costs 10x more – so be prepared! Don’t say I didn’t warn you!