Just so there are no surprises regarding Closing Costs
With Every Purchase, there are Costs that are incurred
A Deposit Cheque - usually 5% of the Purchase Price, is submitted with your Offer and due Upon Acceptance. It should be certified within 24 Hours after Acceptance. This amount will be deducted from your Down Payment on Closing.
You must arrange and maintain Fire and Contents Insurance for the outstanding Mortgage balance or the Replacement Value of your Property. The Mortgagee must be notified of the Policy and if it's a Condominium, the Association must be notified. The Insurance Broker’s info and Policy must be given to your Lawyer on Closing. Basic Homeowner’s Insurance can cost upwards of $400.00 per year.
INSPECTIONS (HOME / TERMITE / POOL / SOIL / ENVIRONMENTAL)
A Qualified Inspector will assess the Property for defects and poor maintenance on your Behalf. Any type of Home Inspection is optional, but highly recommended. The peace of mind in knowing exactly what you are getting when you buy a home can be well worth the fee. The cost is approximately $500.00 and upwards which is paid to the Inspector at time of the Inspection. This takes place usually within a couple of days after Acceptance of your Offer. A Pre-Home Inspection may be required if multi-Offers are anticipated. Each Inspector is qualified in their field and you may have to hire more than one Inspector depending upon the type of Inspections required. Condominiums rarely require a Home Inspection as they rely on the Status Certificate which is provided and paid for by the Seller.
MORTGAGE LENDER / BROKER’S FEES
A fee, usually payable at time of Closing, may be charged by a Mortgage Broker or Lender to arrange a Mortgage on your behalf. They may occasionally also charge an Application Fee. Be sure to ask your Broker or Lender to clarify this ahead of time, as this will be disclosed to you when the Statement of Mortgage is issued. In some cases, they may even waive their Fee which is approximately $300.00.
An Appraiser is usually required and chosen by the Lender who will assess the Value of the Property. This fee is usually $250.0 and will reflect in the Statement of Mortgage.
CMHC / GE FEES
Depending on your Financial situation, you may have to pay insurance on your mortgage. It is best to discuss this with your Mortgage Representative. This Insurance Premium can be added to the Principal Mortgage amount or paid in full on Closing.
An Adjustment takes place when the Seller has already paid for something in advance and wants to be credited for the unused portion as of the Closing Date. These include Property Tax; Utility Bills (Water/ Sewage); Maintenance Fees (Condo) and Interest Adjustments which will reflect in your Lawyer’s Statement of Adjustments.
LAND TRANSFER TAX
Buyers must pay Land Transfer Taxes on transfers of Residential Properties in Ontario which is based on the Purchase Price. Only Properties purchased in Toronto must pay an additional Land Transfer Tax. Check my Website www.VeronicaKey.com under “Buyers” for the Calculation – just enter the Purchase Price. Check with your Mortgage Representative if you qualify for the ‘First Time Buyer’ exemption rebate.
You may have to factor in some Renovations / Repairs (perhaps based on the Home Inspection). Another expense that could arise is the need for Appliances. Always have a little bit extra for those “unexpected” expenses.
Your lawyer is an integral part of the buying process, and you will need a Lawyer to search the Title of the Property and, to transfer the money on Closing Day. As fees vary, get a quote from your Lawyer first, so you have a clear idea of what these Fees will be, and the breakdown of all related expenses and disbursements. Fees in total can range from $1300.00 and upwards.
TITLE INSURANCE / SURVEY
Title Insurance is an Insurance Policy covering the condition of Title or Ownership of Real Property at the time the Policy is issued. Typically obtained by the Buyer’s Lawyer prior to Closing, this is for the benefit of the Buyer and should be discussed with your Lawyer.
The best thing to do is get quotes from at least 3 Movers. Ask if they insure their move. You can either get them to pack your belongings or do that yourself. Find out if they will supply packing materials such as tape, boxes, bubble wrap.
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