House hunting is lots of fun but once you purchase a home, there are various fees you’ll be responsible for when closing time rolls around.
Your mortgage and down payment will cover the cost of your home but it’s important to proactively factor in the extra fees so you don’t get caught off guard. Here are some of the common costs to expect:
Appraisal Fee
In order to arrange a mortgage, the bank will require a home appraisal. The cost of the home appraisal is usually passed onto the buyer but it can oftentimes be worked into the mortgage.
Title Insurance
Title insurance is different than home insurance. Banks often require you to provide title insurance in order to arrange a mortgage, especially when a survey isn’t available.
Legal Fees
Your real estate lawyer is responsible for ensuring that all legal and financial conditions have been met and that there are no outstanding charges against your new home.
Taxes & Adjustments
You’ll be responsible for paying land transfer tax as well as any monetary adjustments such as reimbursing the seller for prepaid property taxes or maintenance fees.
Mortgage Insurance
If you don’t have a large down payment, you’ll need to pay for mortgage insurance which varies depending on the size of your downpayment and the amount of your mortgage.
Closing costs vary depending on individual circumstances but they usually amount to around 3% of the purchase price.
For a more accurate estimate, along with tips on how to reduce your closing costs, please reach out so we can discuss your options.
Buying a home can be an emotional roller coaster but you’ll definitely enjoy a smoother ride if you’re aware of what lies ahead!
