Closing Costs

Closing Costs 
With all the excitement it can be easy to forget to budget for closing costs. There are fees owed on, or by, closing day that must be paid for your house purchase to be complete.

Most of these fees are in addition to, and separate from your mortgage loan (although some closing costs can be added to your mortgage). Closing costs can amount to a significant expense. Experts recommend budgeting at least 2% of the purchase price towards closing costs. To give you a rough idea of what to expect some of the most common expenses are listed below. These expenses are approximations only—they may vary.
Down payment—Minimum 5% of purchase price. Due at closing
Deposit—Due when you make an Offer to Purchase. The deposit will form part of your down payment with the remainder owing at time of closing. The size of the deposits varies

Home Inspection—Although optional it is highly recommended. Due at time services are completed. Starting at $500.
Legal fees (including disbursements)—Expect to pay between $2000 and $2500 for a real estate lawyer but cost varies depending on the extent of services provided. Due at closing

Land Transfer Tax—Due at closing
Example: To calculate the land transfer tax on a purchase price of $275,000, multiply the price by 1.5% and deduct $1525. ($4125-$1525 = $2600)

Up to $55,000 X 0.5% of total property value (0.5% of $55000 is $275)
From $55,000 to $250,000 X 1% of total property value (less $275)
From $250,000 to $400,000 X 1.5% of total property value (less $1525)
From $400,000 up X 2% of total property value (less $3525)

Adjustments on Closing between Buyer and Seller—These include such items as pre-paid taxes/utilities- Varies widely. Due at closing.

Mortgage default insurance—Calculated as a percentage of loan and varies depending on size of down payment. Not usually required for conventional mortgages (down payment of at least 20%). Will be added to your monthly mortgage payments. **Please Note there is an 8% tax charge on this insurance premium. Due at closing.

Appraisal Fee—Your lender may require an appraisal. The cost is usually $400-$750. Due at time of service.

Property/fire insurance—Varies according to coverage level, region and property type. Due by closing.
Title insurance—Based on purchase price you can expect to pay, starting at $350 and up. Due by closing.
Status certificate (for condos only)—$100 taxes in. Due by closing.
Don’t forget to budget extra funds for expenses related to moving (moving company, utility hookups) and regular housing costs once you own the home (utility bills, maintenance).