Closing Costs When Buying a Home

    • Land Transfer Tax

When a home changes hands, many provinces and a few municipalities charge a property transfer tax or title transfer fee.  Rates are usually on a scale of 1% to 2% of the home’s value and can add thousand to your purchase price.  First-time homebuyers qualify for rebates or exemptions in some provinces.  Please speak to your lawyer/notary or Realtor for the exact amount.

    • Appraisal Fee

Your lender may ask you to have a home appraised to confirm its market value.  Fees vary depending on a property’s value and complexity, but are typically start at $250 and up.

    • Legal Fees

A lawyer or notary will help protect your interests by reviewing your purchase agreement, searching the property title, and ensuring that all documents are completed properly.  Basic legal fees start at $1000 plus disbursements, with added services as needed.

    • Home Inspection

An inspection can help make you aware of issue related to a house’s structure and systems, such as plumbing and electrical, and recommended or necessary repairs.  Fees start at about $350 and up.

    • Home/Fire Insurance

Your lender will require proof that the property is insured in case of fire and other damage.  Insurance costs vary depending on the coverage needed and property type, but budget for $750 and up a year.

    • Costs for Newly Constructed Homes

If you’re buying a brand-new home, be prepared to settle any items not quoted in the original price, including upgrades or paving and landscaping fees.  New homes are also subject to 5% GST, although this is often included in you purchase price.  A federal rebate reduces the GST but is on a sliding scale. Please talk to your lawyer/notary for the exact amount

    • Prepaid Costs

If the seller has paid property taxes, water bills, or utilities in advance, you’ll need to reimburse these at closing.  This can add hundreds to your upfront costs, but means these bills will be paid for your first months in your new home.

    • High Ratio Mortgage Insurance

If you have less than a 20% down payment, you or lender will require that you obtain mortgage default insurance.  The good news is, you can roll the cost into your mortgage payments and amortization.

    • Title Insurance

Title insurance can safeguard you against fraud and problems with your property title or survey.  Some Lenders will require this insurance and fees range from $150 to $350.

    • Moving-In Costs

Before the big day, budget for all those last minute things: $100 or more to rent a van or a few hundred for professional movers, $50 to $60 for a locksmith to re-key your locks, and cleaning supplies.

For more information, please watch our video “Home Buying Costs you need to know about

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