Buying a home involves more than just the purchase price. To fully understand the total cost of your new home, it’s essential to account for all associated expenses. Below is a breakdown of additional costs to consider when purchasing a home in Collingwood or the Blue Mountains area.
Key Expenses to Consider
1. Appraisal Fee
An appraisal is an estimate of the property’s value. Your lender may require this, and the cost typically ranges between $250 and $350.
2. Deposit
A deposit demonstrates your commitment to purchasing the home and is paid when you make an Offer to Purchase. This amount is applied toward your down payment.
3. Down Payment
The down payment is the initial money you put toward the purchase:
20% or more qualifies you for a conventional mortgage.
Minimum 5% is required to secure a competitive interest rate.
4. Mortgage Loan Insurance Premium
If your down payment is less than 20%, your lender may require mortgage loan insurance. The premium can be added to your mortgage or paid in full at closing.
5. Home Inspection Fee
A home inspection provides an assessment of the home’s condition. Costs typically range around $500. It’s wise to make your purchase conditional on a satisfactory inspection.
6. Land Registration Fee
In many provinces, this fee is charged as a percentage of the home’s price. It’s also known as a land transfer tax.
7. Prepaid Property Taxes and Utility Bills
You may need to reimburse the seller for prepaid property taxes, utility bills, or oil tank refills.
8. Property Insurance
Property insurance is mandatory on the day of closing and protects your home’s structure and contents.
9. Survey or Certificate of Location
Your lender may request a current survey or certificate of location. Costs range from $1,000 to $2,000.
10. Legal Fees
Legal fees for closing the sale start at a minimum of $500.
11. Title Insurance
To safeguard against ownership issues, title insurance is recommended. Your lender or lawyer may suggest this coverage.
12. Estoppel Certificate Fee
Applicable to condominium purchases (excluding Quebec), this certificate costs up to $100.
Plan Ahead for Success
Understanding these costs ensures you’re fully prepared for the financial commitments of homeownership. For personalized advice or assistance with finding your dream home in Collingwood or the Blue Mountains, reach out to Janet Piotrowski. With her expertise and dedication, Janet will guide you every step of the way.