Buyer's Costs
Lawyer’s fees
Using a real estate lawyer is essential. The lawyer will make sure that you get your home free and clear of any liens, easements and encumbrances except those that are supposed to be there. He/she will also register your mortgage, make sure the existing mortgage is removed, registering you as the new owner amongst other things.
The cost of the service will be in the neighbourhood of $700 to $1,000 depending on the complexity of the purchase.
Once you ask a lawyer to represent, you will get a retainer which will itemize projected costs of things like land transfer taxes, title insurance, projected adjustments, and the HST on CHMC insurance.
Land Transfer Taxes
The Province of Ontario charges a tax to a buyer on every property purchase. Those in Toronto are also subject to a municipal tax. You can use this link to approximate your land transfer tax. The tax is based upon the purchase price of the house. First time home buyers can automatically get a tax credit of up to $2,000.
Inspection Costs
The BIG GUYS strongly recommend on a home inspection even if it a new build. A qualified inspector will point out not only issues that are not always visible but also regular maintenance items to keep in mind. If certain issues are found further negotiation on the price or terms may be warranted. A typical house inspection costs $375 to $500. If specialty inspections like those used or septic systems, well inspections and those for wood burning appliances will be in addition to the general inspection.
Appraisal Fees
Sometimes the bank may want an appraisal on the property to make sure they do not over mortgage it. When the BIG GUYS are used the banks often do not require this since they know the purchase was handled in a professional manner. On private sales it is often ordered since there was no professional opinion offered to the buyer. The bank may charge you up to $500 for this service.
Adjustments on Closing
This is part of a real estate lawyer’s scope of work. These costs will vary with every purchase but include things like being charged the pro-rated property tax if the previous owner paid the entire years taxes for example or if some utilities were prepaid by the previous owner.
Title Insurance
This is charge that is incurred by a lawyer and passed onto you. In Ontario, title insurance, makes sure you get your property free and clear and if errors are made in the registry system then insurance will kick if you were financially harmed. This cost varies depending on the purchase price of the property but something around $400 can be expected.
CHMC
For those that do not have at least 20% to put down on a house then mortgage insurance is a requirement. The Canada Housing and Mortgage Corporation is the most common insurer but there are other options. Costs are generally about the same between insurers. Costs are determined on the price of the house and the amount of the down payment. You can estimate the mortgage insurance by clicking here. While the amount of the mortgage insurance is built into the mortgage itself the HST on that insurance is not. That will be paid as part of the closing costs to the lawyer.