Calculating Closing Costs

The last thing a buyer wants to deal with at closing is an unexpected bill.

House hunting is lots of fun, but once you purchase a home, there are various fees you’ll be responsible for when it comes time to close the deal.

Your mortgage and down payment will cover the cost of your home, but it’s important to proactively factor in any extra fees so you’re not caught off guard. Here are some common closing costs to expect:

Appraisal Fee

The bank will require a home appraisal when arranging a mortgage. The home appraisal cost is usually passed on to the buyer, but it can often be worked into the mortgage.

Mortgage Insurance

If you don’t have a large down payment, you’ll need to pay for mortgage insurance, which varies depending on the size of your down payment and the amount of your mortgage.

Title Insurance

Title insurance ensures clear ownership of the property. Banks often require title insurance to arrange a mortgage, especially when a survey isn’t available.

Legal Fees

Your real estate lawyer is responsible for ensuring that all legal and financial conditions have been met and that there are no outstanding charges or liens against your new home.

Taxes & Adjustments

You’ll be responsible for paying land transfer tax and other monetary adjustments, such as reimbursing the seller for prepaid property taxes or maintenance fees.