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Buying a home is a huge expense, and is generally the largest purchase or investment most Canadians will ever make. It is important to be fully aware that the purchase price of the home is not the only cost that you will have to think about as a homebuyer. There are several other closing costs that will have to be factored in before making any financial purchasing decision to ensure that these costs are within a person’s financial means.

In order to avoid any unpleasant surprises upon the closing of a house, it’s important to understand other expenses associated with buying a home. A professional mortgage broker will be able to walk you through all of these additional mortgage closing costs Ontario that a homebuyer will face. Generally speaking, many mortgage brokers will suggest ensuring that about 1.5% to 2% of the purchase price of the home be set aside for mortgage closing costs within Ontario, with the mortgage closing costs Alberta and other provinces being similar.

Some of the common expenses incurred after the purchase of a home include the following:

Legal fees and disbursements – Depending on the complexity of the transaction, lawyers will charge the homebuyer for their services involved to complete the transfer of the purchase of a home. Generally speaking, lawyers generally charge anywhere between $800 to $2000 for a typical home buying transaction.

Land transfer tax – When a property is transferred in the new homeowner’s name, a land transfer tax fee is charged. This amount depends on the purchase price of the home. The higher the purchase price, the more land transfer tax will be charged.  This will vary by municipality, so it is worth considering before you start home shopping.

Mortgage insurance – Insurance costs for a new home can include mortgage life insurance, default mortgage insurance or even title insurance.

Property appraisal – Many lenders will require that a home be appraised for its actual value when lending money for the purchase of the home.

Property taxes and utility adjustments – At the time of the purchase, any bills that have been already paid by the seller may be adjusted so that the seller is compensated for any taxes or bills that extend beyond the sale date.

Interest adjustments – Adjustments on mortgage interest may be made if the first mortgage payment is made before the transaction closes.

Home inspections – Most home purchases will include a condition to inspect the home prior to the offer going firm. Home inspections generally cost in the $300 range.  These are worth the money since any structural defects or other problems with the home will come to light and can be dealt with in negotiations.

Get in Touch With a Professional Mortgage Broker

An experienced mortgage broker will be able to educate you on the various mortgage closing costs that will most likely have to be paid upon the closing of a new home purchase.  A mortgage broker works for you – not the banks – to find you the best mortgage product from lenders all across Canada.  In Ontario, call Claire Drage at (905) 330-9488 or visit www.YourMortgageOptions.ca.  In Alberta, visit or  call Jim Black of www.HomeloansAlberta.ca at (877) 394-9422.  These award winning mortgage professionals will be able to guide you through all the costs associated with buying a home, and will help you to budget accordingly.  They can also save you thousands on your mortgage and there is no charge for their service! You can even get pre-approved for a mortgage before you start shopping for a home, so you know exactly how much you can afford to spend.