What do closing costs look like?

Author: Boychuk Mortgage Group |

Home Inspection Fee

Home inspections, while not mandatory, are highly recommended and are generally added into the offer as a condition. At a cost of roughly $500, a home inspector will do a thorough overview of the home then provide you a report based on the homes condition.


Generally following an offer on a home, you will be required to submit a deposit to confirm acceptance. The deposit is collected then placed in trust until completion and is then applied to the remaining down payment. It’s important to remember that making an offer is viewed as a contract of sale, therefore, if you are the reason the contract fails to complete, the seller may be entitled to that deposit as compensation for upholding their end of the agreement.

Appraisal Fee

Appraisals are very common in today’s day and age with most lenders requiring this step prior to advancing funds. An appraisal is a current estimate of the value of the home and provides the lender with a basis on which they are lending on. This fee will typically cost about $300.

Legal Fees

Legal fees are the final step to any real estate transaction for both the buyer and the seller. The solicitor will help finalize the sale, prepare mortgage documents, make any tax adjustments, allocate disbursements and protect your interest. The cost for the lawyer’s time will be roughly $1,200 - $1,500.

Land Transfer Tax

Land Transfer Tax is a provincial government tax placed on any purchase of property. You can download and use our FREE app to help estimate the amount you’ll need to set aside.

Title Insurance

Most lenders will require you to cover the cost of title insurance. Title insurance aids as protection against any loss of property ownership should there ever be a dispute. This cost is roughly $150.

Property Tax Adjustments

Upon completion of sale, both the buyer and the seller will be responsible for paying their part of the annual property taxes. The seller will be responsible from January 1st to the adjustment date, and the buyer will take over from the adjustment date on.

Interest Adjustments

Depending on how you set up your mortgage payment schedule, the closing date may not align perfectly with your first mortgage payment. It’s important to note that interest accrues on the mortgage principal from the date at which the mortgage funds were advanced, up until the date of your first mortgage payment.

All of these costs can add up to thousands of dollars at closing and is why it’s important to plan for these costs upfront. Typically, lenders will require you to be able to show 1.5% - 4% of the purchase price in excess of your down payment to help fund these closing costs.

If you have questions regarding closing costs, you can download and use our FREE app to learn more. Or contact us directly at Riley Boychuk Mortgages and we would be happy to answer any questions.