Costs to Consider
When purchasing or refinancing a property, you may incur some or all of the following costs. These costs should be taken into account when assessing your budget and cash requirements:
This fee covers the property valuation performed by a third party appraiser. The fee is approximately $350, depending on the value and type of your property. Home Trust partners with specific appraisers in each province.
Lawyer’s Fee and Disbursements
Your legal fees should be negotiated up-front with your lawyer to avoid any misunderstanding later and allow you to better determine your cash requirements.
Land Transfer Tax
In most provinces, you have to pay a land transfer tax. This tax varies between provinces. In Ontario, the rates are as follows:
|Up to $55,000||1/2%|
|$55,001 to $250,000||1%|
|$250,001 to $400,000||1 1/2%|
For example, if you purchased a home for $100,000 in Ontario, you would pay $725
(1/2 % on $55,000 plus 1% on $45,000). Your lawyer or realtor can provide you with the provincial figure and help calculate your fee.
As the mortgagor, you are responsible to arrange fire insurance for the full replacement value prior to the mortgage being funding for the duration of the term. The cost of the insurance will vary based on property value, municipality and insurance provider.
A survey of the property, by an accredited land surveyor, is also required. This will establish whether the building is located within the specified legal boundaries and complies with local building bylaws. The cost of a survey is usually around $500, but could be higher in complex cases. When purchasing an existing house, ask the present owner whether a survey is available or include this condition in your offer to purchase.
You should also consider any necessary adjustments to be made between you and the seller for property taxes, insurance and heating costs. Your lawyer will help you with this calculation.