Once your home purchase is finalized, there will be some additional costs you should be prepared for called closing costs. Typically, closing costs can range from 1.5% to 4% of the selling price, and are often the legal and administrative fees you are required to pay at the time of closing. Some examples of closing costs are listed below:
Home Inspection Fee
A home inspection is highly recommended. Although it will cost you in the beginning, it can save you a lot of money should there be any serious problems with the home.
Mortgage Default Insurance
If you put less than 20% down on your new home, you will be required to buy mortgage default insurance to protect the lender.
Land Transfer Tax
Land Transfer Tax is the tax you pay when you buy land in Canada. This includes any buildings, buildings to be constructed, and fixtures and is calculated as a percentage of the purchase price of your home.
When determining what your closing costs are, it is important to keep in mind the legal fees you will be required to pay.
This cost covers the estimate on the value of your home and certifies the lender of the resale value.
If the previous owner of the home has already paid the property taxes for the year, you may be required to reimburse them for the amount that has been paid.