Homebuyer's Road Map Series - Closing and Related Cost®
Sunday Jul 30th, 2023
Closing costs are the legal, administrative and disbursement fees associated with buying a home. Understanding these fees will help you budget more accurately. Remember these are additional costs over and above the price of the home.
HOW MUCH LAND TRANSFER TAX WILL YOU HAVE TO PAY?
The land transfer tax is a one-time tax levied by your province when you purchase a property. The tax is based on a percentage of the purchase price of the property, and varies from province to province. Some municipalities also charge a land transfer tax (for example, Toronto).
HAVE YOU BUDGETED FOR THE ASSOCIATED LEGAL COSTS?
Legal costs cover your lawyer’s fees or, in Quebec, your notary’s fees. These may include:
• Reviewing the terms of the offer
• Conducting a title search on the property
• Registering a new title
• Obtaining relevant documents, such as surveys and evidence of liens on the property
• Checking the statement of adjustments for taxes, utility and fuel bills, and other costs that have been pre-paid by the seller at
the date of closing.
DO YOU NEED A HOME INSPECTION?
A home inspector assesses a property’s condition and can tell you if something is not working properly, needs to be changed, or is unsafe. They may be able to identify where there have been problems in the past, such as a leaking basement or termite damage.
WHAT OTHER COSTS CAN YOU EXPECT?
• Interest adjustments between date of closing and first mortgage payment
• GST/HST on a new home or a home that’s been extensively renovated
• Title insurance to provide coverage for losses related to title fraud, survey issues, problems with the title and challenges to the ownership of your home
• Service charges from utility companies for hook-ups on electricity, gas, internet and telephone services
• Appraisal fees
• Moving costs
• Storage costs if you must leave your current residence before you are able to move into your new home
• Furniture and appliances
• Real estate commissions
Now that you have arrived at your destination, it’s time to enjoy your new home!