Everything You Should Know Before Buying a Home

Hummingbird Mortgages • September 10, 2025

Thinking About Buying a Home? Here’s What to Know Before You Start


Whether you're buying your very first home or preparing for your next move, the process can feel overwhelming—especially with so many unknowns. But it doesn’t have to be. With the right guidance and preparation, you can approach your home purchase with clarity and confidence.


This article will walk you through a high-level overview of what lenders look for and what you’ll need to consider in the early stages of buying a home. Once you’re ready to move forward with a pre-approval, we’ll dive into the details together.


1. Are You Credit-Ready?

One of the first things a lender will evaluate is your credit history. Your credit profile helps determine your risk level—and whether you're likely to repay your mortgage as agreed.


To be considered “established,” you’ll need:

  • At least two active credit accounts (like credit cards, loans, or lines of credit)
  • Each with a minimum limit of $2,500
  • Reporting for at least two years


Just as important: your repayment history. Make all your payments on time, every time. A missed payment won’t usually impact your credit unless you’re 30 days or more past due—but even one slip can lower your score.


2. Is Your Income Reliable?

Lenders are trusting you with hundreds of thousands of dollars, so they want to be confident that your income is stable enough to support regular mortgage payments.

  • Salaried employees in permanent positions generally have the easiest time qualifying.
  • If you’re self-employed, or your income includes commission, overtime, or bonuses, expect to provide at least two years’ worth of income documentation.


The more predictable your income, the easier it is to qualify.


3. What’s Your Down Payment Plan?

Every mortgage requires some amount of money upfront. In Canada, the minimum down payment is:

  • 5% on the first $500,000 of the purchase price
  • 10% on the portion above $500,000
  • 20% for homes over $1 million


You’ll also need to show proof of at least 1.5% of the purchase price for closing costs (think legal fees, appraisals, and taxes).


The best source of a down payment is your own savings, supported by a 90-day history in your bank account. But gifted funds from immediate family and proceeds from a property sale are also acceptable.


4. How Much Can You Actually Afford?

There’s a big difference between what you feel you can afford and what you can prove you can afford. Lenders base your approval on verifiable documentation—not assumptions.


Your approval amount depends on a variety of factors, including:

  • Income and employment history
  • Existing debts
  • Credit score
  • Down payment amount
  • Property taxes and heating costs for the home


All of these factors are used to calculate your debt service ratios—a key indicator of whether your mortgage is affordable.


Start Early, Plan Smart


Even if you’re months (or more) away from buying, the best time to start planning is now. When you work with an independent mortgage professional, you get access to expert advice at no cost to you.


We can:

  • Review your credit profile
  • Help you understand how lenders view your income
  • Guide your down payment planning
  • Determine how much you can qualify to borrow
  • Build a roadmap if your finances need some fine-tuning


If you're ready to start mapping out your home buying plan or want to know where you stand today, let’s talk. It would be a pleasure to help you get mortgage-ready.


Nate Atkin
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Fixed vs. Variable Mortgage Rates in Canada

By Hummingbird Mortgages • November 26, 2025
Fixed vs. Variable Rate Mortgages: Which One Fits Your Life? Whether you’re buying your first home, refinancing your current mortgage, or approaching renewal, one big decision stands in your way: fixed or variable rate? It’s a question many homeowners wrestle with—and the right answer depends on your goals, lifestyle, and risk tolerance. Let’s break down the key differences so you can move forward with confidence. Fixed Rate: Stability & Predictability A fixed-rate mortgage offers one major advantage: peace of mind . Your interest rate stays the same for the entire term—usually five years—regardless of what happens in the broader economy. Pros: Your monthly payment never changes during the term. Ideal if you value budgeting certainty. Shields you from rate increases. Cons: Fixed rates are usually higher than variable rates at the outset. Penalties for breaking your mortgage early can be steep , thanks to something called the Interest Rate Differential (IRD) —a complex and often costly formula used by lenders. In fact, IRD penalties have been known to reach up to 4.5% of your mortgage balance in some cases. That’s a lot to pay if you need to move, refinance, or restructure your mortgage before the end of your term. Variable Rate: Flexibility & Potential Savings With a variable-rate mortgage , your interest rate moves with the market—specifically, it adjusts based on changes to the lender’s prime rate. For example, if your mortgage is set at Prime minus 0.50% and prime is 6.00% , your rate would be 5.50% . If prime increases or decreases, your mortgage rate will change too. Pros: Typically starts out lower than a fixed rate. Penalties are simpler and smaller —usually just three months’ interest (often 2–2.5 mortgage payments). Historically, many Canadians have paid less overall interest with a variable mortgage. Cons: Your payment could increase if rates rise. Not ideal if rate fluctuations keep you up at night. The Penalty Factor: Why It Matters More Than You Think One of the biggest surprises for homeowners is the cost of breaking a mortgage early —something nearly 6 out of 10 Canadians do before their term ends. Fixed Rate = Unpredictable, potentially high penalty (IRD) Variable Rate = Predictable, usually lower penalty (3 months’ interest) Even if you don’t plan to break your mortgage, life happens—career changes, family needs, or new opportunities could shift your path. So, Which One is Best? There’s no one-size-fits-all answer. A fixed rate might be perfect for someone who wants stable budgeting and plans to stay put for years. A variable rate might work better for someone who’s financially flexible and open to market changes—or who may need to exit their mortgage early. Ultimately, the best mortgage is the one that fits your goals and your reality —not just what the bank recommends. Let's Find the Right Fit Choosing between fixed and variable isn’t just about numbers—it’s about understanding your needs, your future plans, and how much financial flexibility you want. Let’s sit down and walk through your options together. I’ll help you make an informed, confident choice—no guesswork required.

Divorce and Your Mortgage: What You Need to Know

By Hummingbird Mortgages • November 19, 2025
Going Through a Separation? Here’s What You Need to Know About Your Mortgage Separation or divorce can be one of life’s most stressful transitions—and when real estate is involved, the financial side of things can get complicated fast. If you and your partner own a home together, figuring out what happens next with your mortgage is a critical step in moving forward. Here’s what you need to know: You’re Still Responsible for Mortgage Payments Even if your relationship changes, your obligation to your mortgage lender doesn’t. If your name is on the mortgage, you’re fully responsible for making sure payments continue. Missed payments can lead to penalties, damage your credit, or even put your home at risk of foreclosure. If you relied on your partner to handle payments during the relationship, now is the time to take a proactive role. Contact your lender directly to confirm everything is on track. Breaking or Changing Your Mortgage Comes With Costs Dividing your finances might mean refinancing, removing someone from the title, or selling the home. All of these options come with potential legal fees, appraisal costs, and mortgage penalties—especially if you’re mid-term with a fixed-rate mortgage. Before making any decisions, speak with your lender to get a clear picture of the potential costs. This info can be helpful when finalizing your separation agreement. Legal Status Affects Financing If you're applying for a new mortgage after a separation, lenders will want to see official documentation—like a signed separation agreement or divorce decree. These documents help the lender assess any ongoing financial obligations like child or spousal support, which may impact your ability to qualify. No paperwork yet? Expect delays and added scrutiny in the mortgage process until everything is finalized. Qualifying on One Income Can Be Tougher Many couples qualify for mortgages based on combined income. After a separation, your borrowing power may decrease if you're now applying solo. This can affect your ability to buy a new home or stay in the one you currently own. A mortgage professional can help you reassess your financial picture and identify options that make sense for your situation—whether that means buying on your own, co-signing with a family member, or exploring government programs. Buying Out Your Partner? You May Have Extra Flexibility In cases where one person wants to stay in the home, lenders may offer special flexibility. Unlike traditional refinancing, which typically caps borrowing at 80% of the home’s value, a “spousal buyout” may allow you to access up to 95%—making it easier to compensate your former partner and retain the home. This option is especially useful for families looking to minimize disruption for children or maintain community ties. You Don’t Have to Figure It Out Alone Separation is never simple—but with the right support, you can move forward with clarity and confidence. Whether you’re keeping the home, selling, or starting fresh, working with a mortgage professional can help you understand your options and create a strategy that aligns with your new goals. Let’s talk through your situation and explore the best path forward. I’m here to help.