Half of Canadians who plan to purchase a home think they will only need to cover the down payment to move in. The "closing costs" however, can add as much as another four percent of the total purchase price of the home.
Closing costs can include:
• legal or notary fees
• land registration fees
• municipal levies
• surveys
• appraisal fees
• home inspection fees
• utility hook-ups
• title insurance
• property tax and utility adjustments.
Additionally, if your down payment is less than 20% of the price, you will have to pay for mortgage default insurance plus the provincial sales tax charged on it.
For a $300,000 home, closing costs could range from $4,500 to $12,000. Other up-front payments that may be required include moving expenses and the real estate costs for selling your old home. Even redirecting your mail is an added expense.
A complete guide to the finances of home-buying is available on the website of the Financial Consumer Agency of Canada at itpaystoknow.gc.ca.
