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buying a home closing costs

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buying a home closing costs

Want to get started?

Closing costs of buying a property

Closing is done at the lawyers office, it’s paying all the outstanding fees etc to complete the transaction and must be paid in cash/certified cheque. The exact amount required varies but up to 3% of the purchase price should be set aside for closing costs.

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Summary of closing costs of Ontario mortgage

Appraisal Fee

Often paid by the lender or earlier but sometimes required at closing. Allow $250 to $300. 

Ontario Land Transfer Tax

On the first $55,000 is 0.5% ($275)
between $55,000 – $250,000 is 1% ($1950)
between $250,000 – $400,000 is 1.5% ($2,250)
over $400,000 is 2% of the excess amount.
First time home buyers don’t pay tax on first $368,000

Toronto Land Transfer Tax

On the first $55,000 is 0.5% ($275)
between $55,000 – $400,000 is 1% ($3,450)
over $400,000 is 2% of the excess amount. 
First time home buyers don’t pay tax on first $400,000

Mortgage Default Insurance

If your down payment is 20% or less then you will need default insurance, the premium is typically added to the mortgage. However the 8% PST charged on the premium needs to be paid at closing.

Legal Fees and Disbursements

Your lawyer will review the Offer to Purchase, perform a title search, register the deed and mortgage, review your mortgage contract, prepare closing documents, pay out any disbursements, etc. Expect to pay between $1,500 to $2,500 depending on what is involved. * We have a local law firm with the following fixed prices for basic transactions (taxes Incl): Purchase-$1599; Sale-$849; Purchase & Sale-$2249; Refinance-$899.

Closing Adjustments

The seller will have made payments, such as property taxes and condo maintenance fees, that cover the year. Your lawyer will need to pay the seller at closing. 

Interest Adjustment

This is an interest-only charge by your lender to cover the time between closing and when your mortgage starts. EG if you closed on Nov 15th and your mortgage started on Dec 1st, your adjustment would be for 15 days. 

Property Insurance

Property insurance is mandatory. Proof of coverage is required at closing.

Status/Estoppel Certificate

Condo’s only. Details of condominium corporation’s financial and legal affairs. Cost is $100.

HST on New Home Purchases

Usually the builder will pay the HST, be sure to confirm before closing.

Title Insurance

Title Insurance is a one-off premium that protects you against losing money on anything title related, typically costing between $200 and $300, depending on the type of policy, the property type and the value of the property.

Utility Accounts- Gas/Hydro

Sometimes require $200 deposits for new accounts.

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buying a home closing costs
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