Guide
Closing costs are the part of a purchase people underestimate, because they arrive at the end and are spread across several parties. Here is the itemised list, and roughly what each one runs.
Ontario charges land transfer tax on closing, calculated on a sliding scale against the purchase price. On a typical Oakville purchase it is usually the single biggest closing cost.
First-time buyers can claim a provincial rebate of up to $4,000. If you buy within the City of Toronto there is a second, municipal land transfer tax of comparable size, with its own first-time buyer rebate. Oakville, Burlington and the rest of Halton do not have the municipal tax.
Your lawyer handles title search, registration and the movement of funds. Expect the fee plus disbursements: registration, title search charges and software fees, which are billed separately and add up.
A one-off premium that protects against title defects, fraud and survey problems. Most lenders require it and most lawyers arrange it as a matter of course. It is a modest cost relative to what it covers.
If the seller prepaid property tax, utilities or condo fees beyond the closing date, you reimburse the portion covering your ownership. These are calculated by the lawyers and can shift the final number in either direction.
A home inspection is paid up front and is worth it. Your lender may require an appraisal. If your down payment is under twenty percent, mortgage default insurance applies; the premium is normally added to the mortgage rather than paid at closing, but the provincial sales tax on it is payable on closing.
Between one and a half and four percent of the purchase price, on top of the down payment, is a reasonable planning range. Inside Toronto, plan toward the top because of the second land transfer tax. Your lawyer will give you an exact statement of adjustments before closing, and you should read it.
One and a half to four percent of the purchase price beyond your down payment is a reasonable range. Toronto purchases sit toward the higher end because of the municipal land transfer tax.
No. The municipal land transfer tax applies within the City of Toronto only. In Oakville and the rest of Halton you pay the provincial one.
Up to $4,000 against Ontario land transfer tax if you qualify. Buying within Toronto, there is a separate municipal rebate as well.
No. The deposit accompanies your offer and is credited toward the purchase price. Closing costs are separate and payable at closing.
If you want this applied to your actual situation rather than in general, that is a short conversation and it costs nothing.