If you’re planning to buy a house or condo in Toronto, don’t forget to be prepared for the dreaded Closing Costs. Never fear, knowledge is power! Know what you might have to pay for, so you can work it into your budget ahead of time. Here is a list of the most common and important closing costs when buying a home:
1 - BEFORE CLOSING
Deposit (usually 5% of the purchase price, paid within 24 hours of your offer being accepted)
Property Appraisal ($400- $500, often paid by the lender). Home Inspection ($400-700, paid to the Home inspection company at the time of the inspection).
2 - ON CLOSING
Balance of Purchase Price (the purchase price less your initial deposit. Usually the bulk will come from your lender and become your mortgage–yay!).
Legal Fees (amount varies depending on purchase price – approx $1,800 for a $500,000 purchase)
Title Insurance (sometimes included in your legal fees, $250-$400)
Mortgage Broker Commission (if applicable, usually paid by the lender)
Property Survey (if required – $1,000-$2,000)
Ontario Land Transfer Tax (varies depending on purchase price )
Toronto Land Transfer Tax (varies depending on purchase price)
Property Tax Adjustment (reimbursement to Seller of property taxes they paid beyond the closing date)
HST (generally only applicable on new construction condos and houses) (varies depending on purchase price)
Tarion Warranty Fees (warranty on new construction condos and houses only, not resale)
Provincial Sales Tax (only applicable on chattels purchased from vendor – amount varies)
Adjustments for Utilities/Condo Fees/etc (reimbursement to Seller for prepaid utilities, etc.)
CMHC Insurance Premium (insurance premium charged if you have less then 20% down payment
3 - AFTER CLOSING
Moving Expenses ($1,000+)
Utility Connection Charges (varies)
Redecorating and Renovating Costs (varies)
Immediate Repair and Maintenance Costs (varies)
The path leading to your first home doesn't have to be daunting. You should surround yourself with a team of professionals who can assist you in the process. Contact us for a consultation, we will be happy to help.