When you start thinking about buying a home, you have to realize that it's not just the purchase price that you need to take into consideration. You need to plan your budget for the extra costs that come with buying a property. 

Pre-closing costs:

Home inspection:  A smart decision using a qualified inspector because they can identify issues that you may not realize that may pose a problem. (eg. heating and electrical).

Appraisal or Survey:  Your lender/broker may require either or both before they agree to providing you with financing. This is to make sure the value of the home or property matches its sale price.

Closing costs:

Land Transfer Tax:  In Ontario, a land transfer tax of up to 2 % of the purchase price applies. In Toronto, an additional tax applies, also up to 2 %. First time homebuyers are eligible for a refund of the tax. 

Mortgage Insurance:  If you put a down payment of less than 20 per cent of its sales price, you will be required to buy mortgage insurance. Visit http://www.cmhc-schl.gc.ca

Legal Fees:  You will need a lawyer to file legal documents and make sure there are no liens against the property. They will also register the deed and mortgage for you. To find an Ontario lawyer visit http://www.lsuc.on.ca

Title Insurance:  Title insurance protects you against title fraud, errors in public surveys, encroachment issues with neighbors and more. 

Adjustments:  These are costs that the seller has paid for prior to the closing that you will have to pay back. (eg. property taxes, maintenance fees, oil/propane tanks).

Home Insurance:  You must have insurance on your property before lenders will release the funds for the sale to close.

Harmonized Sales Tax (HST):  Newly-constructed homes are subject to 13% HST. Buyers may be eligible for rebates from Ontario and Federal governments. HST does not apply to resale homes.

Tarion new home warranty program:  In Ontario, new homes are covered by a warranty program, administered by Tarion.  It protects new home buyers against various issues during and after the build. It also offers protection for your deposit. Sometimes the fee is included in the purchase price or it may be due at closing. Visit http://www.tarion.com

After-closing costs:

Moving costs:  These vary on whether you hire a professional mover or rent a truck. As well as boxes and other supplies.

Utility & service hook-ups:  Gas, hydro, water, and cable/internet  charge hook up fees.

Renovations and repairs:  Renovations that you may need to make to make it move in ready. 

Appliances, furniture & decorations:  You may need or want new appliances, furniture or paint to make it feel like home. 

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Caroline Kowalyshen

Caroline Kowalyshen

Sales Representative
CENTURY 21 B.J. Roth Realty Ltd., Brokerage*
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