Closing Costs

There are many costs associated with buying a home, besides the original purchase price. If this is your first time, you might be shocked by unexpected costs. To make things easier, we’ve provided this handy checklist. Also please refer to this handy guide which calculates all of the closing costs for you:

http://www.ratehub.ca/mortgage-calculator-cibc

Feel free to print it out and check off all the costs that apply to you.

Taxes
HST of 13%: Only applies to new homes purchased from a builder.
The good news: Special rebates are available, and your builder may have built the HST into the purchase price so you don’t have pay it at closing.
Land transfer tax: This tax is calculated as a % of the property value, using the asking price as a close estimate. It usually ranges from 0.5% to 2.0% depending on the purchase price of the home.

Land transfer tax rebate: If you are a first-time home buyer and are purchasing a property you are eligible for a rebate

Mortgage-Related Costs
Mortgage loan insurance: CMHC insurance applies when you are borrowing more than 80% of the purchase price of the home. Use our calculator to understand the implications of different down payments percentages.

Calculators Page

Home insurance:
Required by all mortgage lenders before closing. Most insurers offer discounts for bundling home & auto.

Title insurance: Most lenders will accept title insurance in lieu of an official property sketch or survey. Lawyers also recommend it to protect you against mortgage fraud and identity theft. The cost? Approximately $400

Land Transfer Tax
Purchasers in most large Canadian centres can add Land Transfer Taxes to their list of closing costs.

Many provinces have multi-tiered taxation systems that can prove complicated. If you purchase a property for $260,000 in Ontario, for example, .5 per cent is charged on the first $55,000, 1 per cent is charged on $55,000 – $250,000, while the $250,000 – $400,000 range is taxed at 1.5 per cent. Your total tax bill? $2,375.00.
Ontario Land Transfer Tax
Up to $55,000 X .5 % of total property value
From $55,000 to $250,000 X 1 % of total property value
From $250,000 to $400,000 X 1.5 % of total property value
From $400,000 up X 2 % of total property value

​TORONTO HAS ITS OWN LAND TRANSFER TAX​, The new liberal government has introduced the idea of each Municipality having its own Land Transfer Tax applicable to all purchases, it has not been enforced however

Calculate the probable land transfer tax for your purchase here:

Calculators Page

Real Estate Costs
There are no costs to the purchaser when buying a home, as all of the real estate agents fees are paid to by the seller, if you happen to be a seller the costs can range, but the industry norm is 5%.

Legal Costs

The legal fees will vary by province and can cost approximately $800 – $1500 plus HST where applicable.

Adjustments: These are reimbursements to the seller for any payments that were made for a period extending beyond the closing date. Adjustments will be paid by the buyer to the lawyer.

• Property taxes
• Prepaid water, hydro or gas charges
• Service contracts such as alarm system, lawn care, pool maintenance, hot water tanks
• Metered services such as hydro, gas and water
• Oil tank: the seller tops up the tank and the buyer pays for a full one

Remember, even though it seems like a lot right now, you are still putting yourself in a position where you are going to build equity, and that adds up much faster than paying rent monthly to your landlord