Many 1st-time buyers are unaware of the additional costs that are incurred when closing a Real Estate transaction, with the exception of the down payment. There are several costs that you will need to be aware and have funds set aside for, as closing costs can accumilate to the tune of about 3-5% of the purchase price and are in addition to the down payment.
Your agent will normally explain the additional costs to you, but I thought I would publish the list of costs that I give to my buyers within the first two meetings with them. The list below is, by no means, comprehensive; it is merely intended to give 1st-time buyers a general idea of what the average closing costs for a home are.
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Expense
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Estimated Amount
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When Payable
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Mortgage Application Fee and/or Property Appraisal
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$75-$250
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Time of Closing
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Legal fees
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$500-$1200 + HST
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Time of Closing
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Fuel Oil Adjustment
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$ 900-$1,200
(Full tank of oil)
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Time of Closing
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Propane Adjustment
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$450
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Time of Closing
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Tax Adjustment
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Taxes Prepaid by Vendor
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Time of Closing
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Condo Fees(if applicable)
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Usually One Month Fee
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Time of Closing
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Survey/Location Certificate
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$300-$500
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2-3 weeks prior to closing
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Land Registration
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$ 700 - $1,500
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Usually the responsibility of the Seller, but if the buyer is selling (or refinancing) their present property, they must pay to have their own property done.
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Home Insurance
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$300-$500
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Arrange with Insurance Company
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Deed Transfer Tax
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Up to 1.5% of the purchase price (Municipality Rate)
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Time of Closing
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Water Test(if on a well)
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$60-$250 + HST
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2-3 Days After an accepted Agreement
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Property Inspection
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$300-$450 + HST
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2-5 Days After an Accepted Agreement
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Mortgage Insurance
(if mortgage amount is greater than 75% of price or appraisal)
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Max 3.75% of Mortgage
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When Mortgage funds are released (usually included in Mortgage so not applicable at time of closing)
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Miscellaneous Expenses
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Costs Vary: Includes electricity, phone, cable, water hookups; changing of locks, moving expenses, etc.
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Time of Closing
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Please note that these costs are ESTIMATES only, based on an average-priced property and may vary significantly.
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So, to all of you out there looking for your first home: I hope that you find this list helpful. Like I said before, there may be other costs that are not included in my list; please talk to your agent about location-specific closing costs.
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