The total cost of buying a home involves
not only the purchase price of the property,
but also other costs that arise on closing
the transaction. These expenses, incurred by
the buyer, are necessary to complete the
purchase but are outside of the purchase
price for the property. Fees, types of
services provided, and procedures required
in the closing process will vary by
provincial jurisdiction. The following list
is provided for illustration purposes and is
not exhaustive in nature.
Adjustments for realty taxes and
fuel.
Legal expenses and disbursements,
lawyers’ services and expenses (items
paid on behalf of the buyer).
Mortgage expenses including interest
on assumed mortgages (calculated as part
of the adjustments), any arranging
costs, and registration of a new
mortgage in the land registry or land
titles office.
House insurance for fire and other
hazards, typically including liability
coverage.
Title search and registration of
appropriate documents in the land
registry or land titles office.
Cost of survey, zoning memorandum,
tax certificate, and other related
matters based on provincial
requirements.
GST : Most purchases of new housing
require the payment of GST on the
purchase price, although a partial
rebate is available. Most purchases of
resale homes do not require the payment
of GST, however, confirmation of this
fact should be obtained. As a guideline,
GST is payable on properties other than
resale residential property, subject to
certain exceptions. GST is also payable
on lawyer’s fees and most disbursements.
Land transfer tax.
Personal expenses, e.g., moving
costs and purchase of household goods.
Once a total is calculated, the closing
cost can be substantially higher than the
buyer anticipated. All buyers should be
aware of these extra costs before finding
themselves legally bound to an
agreement/contract and possibly unable to
fulfill the financial terms. Various costs
apply when selling a home, however, the
seller has the proceeds of the sale from
which to pay them.
The date when title to real property
transfers to the new owner at the land
registry or land titles office, frequently
referred to as the closing date. The
transaction is normally viewed as complete
when the respective solicitors meet at the
land registry or land titles office and
exchange the necessary completed
documentation. When the deed or transfer is
accepted for registration, the transaction
is complete, and money and keys are
exchanged.
A document itemizing the complete
financial history of a real estate
transaction including the deposit, down
payment, adjustments, balance due on
closing, and mortgage amount.
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