26 November 2025

Buying a property is an important step, but certain financial and mortgage mistakes can be very costly even before finalizing your real estate purchase. Poor budget preparation, forgetting hidden fees or rushing into a mortgage loan: these missteps can turn a great project into a source of stress.

As a real estate broker in Gatineau, I support buyers every year in preparing for their purchase. Here are the 10 most common financial mistakes to avoid so you can complete your real estate project with confidence.

1. Poorly defining your purchase budget

The first mistake, and probably the most common, is underestimating the real cost of buying a property. The price shown on the listing is only the visible part of the investment.

Buyers often forget the additional fees: notary, inspection, transfer duties and tax adjustments. These costs must be included in your overall budget before signing the mortgage loan.

In addition to the sale price, you will need to plan for:

• Notary fees;
• Transfer duties (or “welcome tax”);
• Inspection fees;
• Appraisal fees;
• And sometimes tax or heating adjustments at signing.

These closing costs generally represent between 3% and 4% of the property price. For example, for a $400,000 home, this can represent $12,000 to $16,000.

Tip: establish your overall budget before you start visiting properties, not just the mortgage amount.

2. Neglecting mortgage pre-approval

Mortgage pre-approval is an essential step before you start looking for a property. It allows you to know your real borrowing capacity based on your income, debts and monthly expenses.

Without prior mortgage approval, you risk visiting homes that are above your budget or having your offer refused by the mortgage lender at the most critical moment.

Another advantage: a mortgage pre-approval locks in your interest rate for a period of 90 to 120 days. If rates increase during your search, your mortgage rate remains protected, giving you valuable financial security while you look.

3. Buying at the maximum of your capacity

Pre-approval gives you a limit… but that limit is not a target. Many buyers go into debt up to the maximum allowed, forgetting that life always brings surprises: a new baby, job change, rate increases, repairs, etc.

Financial institutions use ratios to calculate your capacity:

• GDS (gross debt service): your housing expenses should not exceed 39% of your gross income.
• TDS (total debt service): all of your debts (housing, car, credit cards, etc.) should not exceed 44%.

If you buy at the ceiling, the slightest change in rates or income can weaken your budget.

Give yourself a safety margin of 5% to 10% below the maximum approved amount.

4. Forgetting recurring costs

Many buyers calculate their budget based only on the mortgage payment. But being a homeowner also means covering several ongoing expenses:

• Municipal and school taxes;
• Home insurance;
• Annual maintenance and repairs;
• Electricity and heating;
• Condo fees, if applicable.

Depending on the type of property and its location, these costs can represent several hundred dollars per month. A good habit: prepare a full monthly budget before making an offer to purchase.

5. Ignoring the financial health of the condo association

Buying a condo comes with its own financial pitfalls. Before making an offer, take a close look at the condo association’s financial health.

Ask for:

• Reserve fund information;
• Recent meeting minutes;
• Inspection reports or reserve fund studies;
• Financial statements from the last few years.

A poorly managed or underfunded condo association can lead to special assessments for urgent work (roof, parking, windows, etc.).

A special assessment of $5,000 or $10,000 is not uncommon in an older building. Check before you buy!

6. Signing without reading all the documents

Between the promise to purchase, the seller’s declarations, the certificate of location and the condo bylaws, there are many documents to analyze. Yet some buyers sign them without really reading.

However, these documents often contain essential information about the condition of the property, easements or ongoing disputes. Missing a single note can be costly.

Always take the time to read each document carefully or ask your real estate broker to help you understand them.

7. Neglecting the inspection

Inspection is sometimes seen as a formality, but it is still a crucial step. It helps detect problems that are invisible to the naked eye: structure, insulation, roof, electrical system, water infiltration, etc.

The cost of an inspection ranges from $400 to $700, but it can save you from repairs costing several thousands of dollars after the purchase.

Never skip this step, even for a recent condo. And don’t hesitate to ask the inspector questions!

8. Basing your decision only on the mortgage rate

A low interest rate is attractive, but it is not enough to determine whether a mortgage is advantageous.

Before choosing a mortgage loan, also compare:

• Term length;
• Prepayment penalty conditions;
• Administrative fees;
• Additional payment options (10% or 20% per year).

Sometimes a slightly higher rate offers more flexibility and costs less in the long term.

The best mortgage rate is the one that fits your needs and your financial stability.

9. Forgetting the emergency cushion

Buying a home always comes with additional expenses: moving, new furniture, appliances, curtains, tools… These often overlooked costs can add up to several thousands of dollars.

Plan for an emergency fund equivalent to 2 or 3 months of expenses to deal with unexpected events. This safety margin helps you avoid using consumer credit if a problem occurs.

Good financial management also means keeping some room to breathe after the purchase.

10. Buying without the right support

Buying a property is not just about choosing a house: it also means dealing with complex administrative, legal and financial procedures.

A real estate broker helps you evaluate the fair value of the property, structure your offer and negotiate in your best interest. A mortgage broker compares offers from different mortgage lenders to help you get the best financing. And a notary secures the transaction from a legal standpoint.

Surrounding yourself with these professionals means making the right choices and avoiding costly mistakes.

Having the right team around you is the best guarantee for a real estate purchase with no bad surprises.

Quick checklist before buying

• Define a complete budget, including closing costs and the welcome tax.
• Obtain a valid mortgage pre-approval.
• Check the financial health of the condo association.
• Plan the inspection before signing anything.
• Set aside an emergency cushion after the purchase.

The more you plan ahead, the less financial surprises will disrupt your project.

Frequently asked questions about buying a property

What fees should I expect in addition to the purchase price?

Notary fees, transfer duties, inspection, home insurance and tax adjustments usually represent 3% to 4% of the purchase price.

When should I get a mortgage pre-approval?

Ideally before even visiting properties. This gives you a clear idea of your borrowing capacity and protects your interest rate for several weeks.

How can I check the health of a condo association?

Ask for recent minutes, the reserve fund information and the financial statements. A low reserve fund can be a warning sign for future special assessments.

When is the best time to renegotiate a mortgage?

Generally, when mortgage rates have dropped by at least 1% compared with your current contract, while taking prepayment penalties into account.

How much should I plan for closing costs in Quebec?

Around 3% to 4% of the property price, depending on the type of home and the services required.

In summary: prepare, compare and surround yourself with experts

Buying a property is an exciting adventure, but it requires rigorous financial preparation. By avoiding these ten common mistakes, you give yourself the best chance to buy with peace of mind and invest wisely.

Take the time to compare mortgage rates, review the documents, verify your numbers and surround yourself with the right experts.

Preparing your purchase properly is the key to turning a real estate dream into lasting success.