CONSIDER THE CLOSING COSTS WHEN PURCHASING A HOME

Amidst the current affordability of mortgage rates, it's vital to factor in "closing costs" alongside your down payment when striving for your dream home.

These assorted expenses can accumulate and, for the most part, they constitute essential legal obligations when acquiring property. Here's an overview of key "closing costs":

Legal Fees: Engaging a lawyer in your home-buying journey involves associated fees. These typically cover title searches, arranging property surveys if required, and managing other necessary disbursements.
Mortgage Insurance and Application Fee: Lenders necessitate mortgage insurance for high ratio mortgages, where 75 percent or more of the home's purchase price is covered by the mortgage.
Mortgage Broker's Fee: If a mortgage broker assists you in securing a mortgage, they might levy a fee, which can be integrated into legal fees if your lawyer handles the mortgage, or absorbed within the lender's charges if you work directly with them.
Property Insurance: Proof of property insurance is often a lender requirement before processing a mortgage. This insurance encompasses home and contents replacement value.
Home Inspection: Professional home inspectors are adept at identifying key aspects and can complement information from your REALTOR® or your personal inspection. Basic home inspections generally range from $150 to $300.
Land Transfer Tax: Purchasers in Ontario must pay a land transfer tax, varying between 0.5 to two percent of the home's purchase price, contingent on its value.
GST: GST is payable to varying degrees on the purchase of new homes, although partial rebates may apply. Typically, resale residential homes are exempt from GST, yet various other closing fees might entail GST payments.
Additional Charges: Certain expenses such as heating oil or other pre-closing day seller-incurred costs might fall on the buyer.
Hook-Up Fees: Appliance and utility services, including telephone, TV cable, and hydro, might incur hook-up charges.
Moving Costs: Basic moving expenses, especially if engaging a professional moving company, should not be overlooked when transitioning from your old residence to your new abode.

Relying on a REALTOR® to elaborate on these aspects is advisable. Incorporating closing costs into your financial plan as you save for your home purchase is a prudent approach.