Spring is one of the busiest seasons in the real estate market, with eager buyers looking to find their dream home before summer. If you’re planning to purchase a home in Spring 2025, now is the time to get your finances in order so you’re in the best position to secure a mortgage with favourable terms.

To help you navigate the process, here’s a step-by-step guide on how to financially prepare for the spring homebuying season.

1. Check and Strengthen Your Credit Score

Your credit score is one of the most critical factors in determining your mortgage eligibility and interest rate. A higher score can save you thousands of dollars over the life of your mortgage.

✔️ Check your credit report for errors and dispute inaccuracies.

✔️ Pay down outstanding debts to lower your credit utilization.

✔️ Avoid applying for new credit in the months leading up to your mortgage application, as this can temporarily lower your score.

Pro Tip: As a mortgage broker, I can pull your credit only once while shopping for the best mortgage options, helping to preserve your score and avoid multiple inquiries that could lower it.

2. Build a Strong Down Payment

A larger down payment can reduce your monthly mortgage costs, improve your loan terms, and, in some cases, eliminate the need for mortgage insurance.

🏦 Set a savings goal based on home prices in your target area.

🏠 Explore first-time homebuyer programs that offer down payment assistance.

💰 Automate deposits into a dedicated savings account to build your down payment faster.

🚨 Important: Avoid moving large sums of money between accounts before applying for your mortgage. Lenders require a 90-day history of your down payment, and frequent transfers can complicate verification.

3. Reduce Your Debt-to-Income Ratio (DTI)

Lenders calculate your Debt-to-Income Ratio (DTI)—also known as GDS/TDS—to assess your ability to handle mortgage payments on top of existing obligations. A lower DTI improves your chances of approval and increases your borrowing power.

🔹 Pay down high-interest debts (credit cards, personal loans) to free up income.

🔹 Avoid large purchases or new loans (like a car loan) before applying.

🔹 Increase your income if possible (through bonuses, side gigs, or promotions).

Note: If you’re self-employed or have variable income, lenders often require a two-year history of your earnings for qualification.

4. Get Pre-Approved for a Mortgage

A mortgage pre-approval is crucial in today’s competitive market. It helps you:

✅ Understand your budget and prevent overbidding.

✅ Show sellers you’re a serious buyer, giving you an edge in negotiations.

✅ Lock in an interest rate for up to 120 days, protecting you from rate increases.

🔹 Gather your documents (pay stubs, tax returns, bank statements).

🔹 Compare lenders and mortgage terms with expert guidance.

🔹 Download my mortgage app for quick pre-approval and loan insights.

📞 Contact me today to get pre-approved and start house hunting with confidence!

5. Budget for Additional Homeownership Costs

Buying a home involves more than just your mortgage payment. Be sure to budget for these additional expenses:

💰 Closing Costs: Typically 1.5% – 4% of the home price, covering legal fees, land transfer taxes, and more.

🏡 Property Taxes & Condo Fees: Vary by location and property type.

🛠️ Home Maintenance & Emergency Repairs: Always have a savings buffer for unexpected costs.

6. Research the Housing Market

Spring is a competitive time to buy, so being well-informed can give you an edge:

📊 Monitor home prices in your desired neighbourhood.

📈 Stay updated on mortgage rates, as they directly impact affordability.

🤝 Work with a trusted real estate agent to navigate bidding wars and negotiations.

7. Consider Locking in an Interest Rate

Interest rates can fluctuate, and even a small increase can significantly impact your monthly payments. If rates are expected to rise, securing a lower rate now could save you thousands over time.

💡 Ask about rate locks and how long they’re valid. Many lenders offer 120-day rate holds.

📉 Compare fixed vs. variable rates to see which aligns best with your financial goals.

📢 Monitor Bank of Canada rate updates, as recent decisions have led to declining variable rates.

Final Thoughts: Get Ready for Spring 2025

Taking these steps now will set you up for success when the spring market heats up. The more financially prepared you are, the smoother your homebuying journey will be—helping you land the right home at the right price.

📞 Thinking about buying this spring? Let’s chat about your mortgage options!