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Budgeting for a new home can be difficult. Not only are there mortgage installments and the down payments to take into consideration, there are a host of other, and sometimes unexpected, expenses to take into account. The last thing you want is to be caught financially unprepared for taxes and other hidden fees on closing day. These expenses vary. Some of them are one-time costs; others will take the form of monthly or yearly installments, while some may not even apply to your particular case. In any case, it’s best to educate yourself on all outcomes to be prepared for anything that may occur.
1. Deposit for the purchase offer.
2. Inspection by a certified building inspector.
3. Appraisal fee: Your lending institution may and usually do request an appraisal of
the property. The cost of this appraisal is your responsibility.
4. Survey fee: If the home you’re purchasing is a resale (as opposed to a newly built home), your lending institution may request an updated property survey. The cost for this survey will be your responsibility and will range from $700 to $1000.
5. Mortgage application at your lending institution.
6. 5% GST: this fee applies to newly built homes only, or existing homes that have recently undergone extensive renovations.
7. Legal fees: A lawyer should be involved in every real estate transaction to review all paperwork. Experience and rates offered by lawyers range quite a bit, so shop around before you hire.
8. Homeowner’s insurance: Your home will serve as security against your loan for your financial institution. You will be required to buy insurance in an amount equal to or greater than the mortgage loan.
9. Land transfer (purchase) tax: This tax applies in any situation in which a property changes owners and can vary greatly.