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| TYPICAL CLOSING COSTS |
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The total cost of buying a home involves not only the purchase price of the property, but also other costs that arise on closing the transaction. These expenses, incurred by the buyer, are necessary to complete the purchase but are outside of the purchase price for the property. On average, closing costs account for an additional 2% of the purchase price. The following list is provided for illustration purposes and should only be used as an educational guide. |
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| TERM | DEFINITION | AMOUNT |
| Deposit | Money paid in good faith to assure performance of a contract. |
at least 5% of the purchase price
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| Home Inspection | A
home inspector will check items
such as the roof, the basement,
the heating system, the water
heater, and the air-conditioning
system, structure, plumbing,
electrical, and many other
aspects of buildings looking for
damage which may require
expensive repairs, as well as
fire, safety, and health
hazards.
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$300 - $400 |
| Title Insurance |
An insurance policy that
protects the holder from loss
sustained by Defects in the
Title. Obtaining title insurance
can simplify real estate
transactions (e.g. may eliminate
the need for an up-to-date
survey, thus providing savings
to the buyer).
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$300 - $400 |
| Legal Fees |
These are charges in which
lawyers bill for services
rendered. For example, you will
need a lawyer to search the
title and cover all the legal
dealings. Rates will vary, so
shop around!
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$1200 (on average) |
| Land Transfer Tax | A
tax imposed on real property
typically calculated on the
value of the property being
registered in a land
registration office.
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Depends on Purchase Price |
| Mortgage Loan Insurance |
Contract insuring a mortgage
lender against default risk.
Mortgage insurance allows a
borrower to purchase a home with
a down payment as low as 3 to 5%
of the purchase price instead of
the usual 20% down payment
lenders normally require. The
insurance premium is normally
added to the mortgage principal
amount.
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with a 5% down payment, CMHC charges an insurance premium that equals 2.75% of the mortgage |
| Prepaid Property Tax and Utility Adjustments |
The amount you will owe if the
person selling you the home has
prepaid any property taxes or
utility bills.
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varies in price; amount becomes part of the "Statement of Adjustments" prepared by your lawyer |
| Home Insurance |
Home insurance protects against
damage or loss of your home and
your personal belongings and
must be purchased prior to
closing.
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$400/year and up |
| GST on New Homes |
New home purchases are subject
to GST but may qualify for a GST
rebate. You do not have to pay
GST on the purchase price of a
used residential home.
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5% x purchase price |
| Moving Costs | The amount will vary greatly, especially if you pack everything yourself, rent a truck, and acquire the help of your family! However, moving costs will add up if you decide to use a moving company. Once again, shop wisely! |
$500 and up |
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The material provided is for informational purposes only. Although the site owner and creators assume the information to be correct, and attempt to keep information on this website as current as possible, they do not warrant the accuracy or completeness of any information included in or linked to this page. |
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