UNEXPECTED & EXPECTED
Common Costs For Buyers
Funds to cover your down payment and closing costs will most likely have to be in the form of a bank draft or wire transfer to your lawyer's trust account. Your lawyer will detail the exact amounts required. Home buyers are focused on securing the required downpayment fall blind to the additional costs associated with buying a home. This unexpected financial hit can greatly add unwanted stress. Learn More.
The deposit will become part of the offer as a sign of good faith which typically is 5% of the purchase price.
Homes Inspection / Buyers Due Diligence
A qualified Home Inspector can identify and or discover underlying problems in a home. The cost can vary. For one of the biggest finical purchases you will ever make , having peace of mind of knowing exactly what you are purchasing is well worth the cost.
COMMON & HIDDEN CLOSING COSTS
PRIOR TO CLOSING
Down Payment - Balance of Down Payment
Lenders require a down payment from buyers, typically up to 20% of the appraised value of the homes purchase price. Balance of down payment is due after initial deposit with offer.
Land Transfer Tax & Title Registration Fees
When buying a home, many people overlook the significant cost of land transfer tax. When you acquire a property (and the land it rests on), you must pay a tax to the government after the transaction closes. The amount paid depends on the value of your property. For First time home buyers when purchasing a home transfer tax rebates may apply.
Mortgage Insurance Premiums If Applicable CMHC
Mortgage default insurance, also referred to as Canada Mortgage and housing Corporation CMHC insurance, is mandatory in Canada for down payments of less than 20% of the purchase price. Mortgage default insurance protects lenders in the event a borrower stops making payments and defaults on their mortgage loan. CMHC insurance premiums are paid for in full by the borrower at the start of their mortgage.
Legal Fees And Associate Disbursements: couriers, copies etc.
There are a number of legal documents involved in the purchase of your new home. The cost of a lawyer can be costly and buyers should give them ample time to research a real estate lawyer that is best suited for their case. Your lawyer will perform a Title Search to ensure there are no liens against the property and will register your deed and mortgage.
Title Insurance Policy Premiums
Requested by your mortgage lender, title insurance is an insurance policy that protects residential or commercial property owners and their lenders against losses related to the property’s title or ownership.
Survey Expenses If Applicable
You or your lender may require that a survey be done either to satisfy you or your lender.
Pro-Rated Amounts - Adjustments on Closing
Adjustment is the amount that has been prepaid on an item that could include: property tax, utilities, prepaid common expenses in a condo ect. by the Seller which is applied beyond the closing date and will benefit the purchaser after the closing date. The amount that has been over paid by the Seller is pro-rated, and a credit is given to the seller as an adjustment on closing.
Your mortgage lender may require proof of your home insurance on your new home before funds will be released for the purchase of the sale. Basic home insurance package for residence cover three main areas: Buildings , Contents and Liability.
Harmonized Sales Tax - HST
In a real estate contact will read either Included In, meaning the seller will be responsible for paying the HST at close, or it might read In addition requested by the seller which means the buyer will be responsible for the HST come closing.
Tarion New Home Warranty Program
Guarantees protection to buyers from various issues that may emerge on builds of new homes. Plus deposit protection is offered. Enrolment fee maybe included in the purchase price, or it may be due at closing. Visit www.tarion.com, for more information.
COMMON CLOSING COSTS