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Residential Mortgage Closing Costs

We have compiled a list of common mortgage closing costs associated with typical residential mortgages. Lenders generally require proof 1.5% of the purchase price in funds available for closing costs on typical residential purchases. Legal Fees & Disbursements A Notary or a Lawyer will finalize the mortgage documents and register them on the Land Title for you. Since the visit to your lawyer is the last step in the entire process, it's extremely important that this is handled with care. Your lawyer or notary will charge you a fee for drawing up the mortgage and conveyance of title. The amount of the fee will depend on the individual that you use and the complexity of the mortgage and disbursements. The typical cost is $650 to $1,200. Property Transfer Tax The British Columbia Provincial Government imposes a Property Transfer Tax when you purchase a home and transfer an interest in title. The Property Transfer Tax must be paid at the time the Land Title is registered. British Columbia Property Transfer Tax is calculated at 1.00% of the First $200,000 and 2.00% of the remaining purchase price. There are situations where you may be exempt from paying Property Transfer Tax which include but not limited to exemptions for first time home buyers and transfers between family members. Some conditions apply to exemptions. For up-to-date Property Transfer Tax information please visit the BC Governments website. Title Insurance Most lenders will require Title Insurance to be purchased at closing. Title Insurance protects both you and the lender from a number of items including fraud and forgery against fraudulently registered mortgages on your title, loss resulting from previous renovations without a permit, and many more items. Title Insurance typically costs between $150 to $300. Land Survey A Land Survey may be required by a lender. A current Land Survey will show the position of the home on the property and include any easements associated with the property. Land Survey costs will vary based on land size and location. Property Appraisal A Property Appraisals may be required to determine the fair market value or lending value of the property you are purchasing or refinancing. This will determine the maximum loan-to-value of your mortgage. Generally all private sales and estate sales will require an appraisal. Appraisals for a typical single-family home range from $275 to $375.  Home Insurance Lenders will require that insurance be placed on the property with the lender as the recipient of the insurance to pay off the mortgage balance from the insurance proceeds. Insurance will need to be in place at the time of closing and the Solicitor will require proof of insurance. Insurance costs will vary and it is recommended that once a lender commitment is received that you review the lenders requirements prior to placing the insurance as some lender may or may not require earthquake coverage.  Property Tax Adjustment Property Tax Adjustment will vary based on the properties tax owed or paid by the current owners. Adjustments will be made for either you or the current owner to pay their share of the property tax at closing. Property taxes are commonly due on July 1st of each year and are for the current calendar year thus if a purchase is made after July 1st the purchaser will owe the previous owner an adjustment up to December 31st.  

Property Tax Hold Back If a lender is collecting property taxes on your behalf there may be a Property Tax

Hold Back which will be equivalent to the months that have lapsed since the previous July to the closing date of

the mortgage. This is to ensure there are enough funds to cover the property taxes for the year which are due

each July 1st and are calculated for the calendar year

Sales Tax Currently GST is charged on new homes in British Columbia. Rebates may be available and most lenders will finance net-GST. For more information please visit Canada Revenue Agency's web page on New Housing Rebates. Home Inspection This is probably the best $300-$500 you will ever spend. Typically Lenders will not require you to obtain a home inspection however it is highly recommended that you have a home inspected whenever possible, so that you're completely informed about what you can't see behind the walls. There may be mould, old wiring or leaks that will cost you a lot to fix down the road. Mortgage Fees Mortgage Brokerage and/or a Lender fees on a typical mortgage will not apply. However, in the case of a more complex or in the case of private financing fees may apply. The fees are disclosed upfront and outlined in the mortgage commitment prior to closing. Other Costs to Consider Other costs may apply when purchasing a home. Costs associated with the mortgage will be presented prior to your mortgage closing date. Other costs to consider are strata fees, moving expenses, utility hook-ups, change of address expenses and more. 
More
BUY MY FIRST HOME CONTACT A MORTGAGE BROKER APPLY  FOR A MORTGAGE
I WOULD LIKE TO:
LEARN ABOUT INTEREST RATES REFINANCE MY MORTGAGE Apply Tweet Me

Residential Mortgage Closing

Costs

We have compiled a list of common mortgage closing costs associated with typical residential mortgages. Lenders generally require proof 1.5% of the purchase price in funds available for closing costs on typical residential purchases. Legal Fees & Disbursements A Notary or a Lawyer will finalize the mortgage documents and register them on the Land Title for you. Since the visit to your lawyer is the last step in the entire process, it's extremely important that this is handled with care. Your lawyer or notary will charge you a fee for drawing up the mortgage and conveyance of title. The amount of the fee will depend on the individual that you use and the complexity of the mortgage and disbursements. The typical cost is $650 to $1,200. Property Transfer Tax The British Columbia Provincial Government imposes a Property Transfer Tax when you purchase a home and transfer an interest in title. The Property Transfer Tax must be paid at the time the Land Title is registered. British Columbia Property Transfer Tax is calculated at 1.00% of the First $200,000 and 2.00% of the remaining purchase price. There are situations where you may be exempt from paying Property Transfer Tax which include but not limited to exemptions for first time home buyers and transfers between family members. Some conditions apply to exemptions. For up-to-date Property Transfer Tax information please visit the BC Governments website. Title Insurance Most lenders will require Title Insurance to be purchased at closing. Title Insurance protects both you and the lender from a number of items including fraud and forgery against fraudulently registered mortgages on your title, loss resulting from previous renovations without a permit, and many more items. Title Insurance typically costs between $150 to $300. Land Survey A Land Survey may be required by a lender. A current Land Survey will show the position of the home on the property and include any easements associated with the property. Land Survey costs will vary based on land size and location. Property Appraisal A Property Appraisals may be required to determine the fair market value or lending value of the property you are purchasing or refinancing. This will determine the maximum loan-to- value of your mortgage. Generally all private sales and estate sales will require an appraisal. Appraisals for a typical single-family home range from $275 to $375.  Home Insurance Lenders will require that insurance be placed on the property with the lender as the recipient of the insurance to pay off the mortgage balance from the insurance proceeds. Insurance will need to be in place at the time of closing and the Solicitor will require proof of insurance. Insurance costs will vary and it is recommended that once a lender commitment is received that you review the lenders requirements prior to placing the insurance as some lender may or may not require earthquake coverage.  Property Tax Adjustment Property Tax Adjustment will vary based on the properties tax owed or paid by the current owners. Adjustments will be made for either you or the current owner to pay their share of the property tax at closing. Property taxes are commonly due on July 1st of each year and are for the current calendar year thus if a purchase is made after July 1st the purchaser will owe the previous owner an adjustment up to December 31st.  

Property Tax Hold Back If a lender is collecting

property taxes on your behalf there may be a

Property Tax Hold Back which will be equivalent to the

months that have lapsed since the previous July to the

closing date of the mortgage. This is to ensure there

are enough funds to cover the property taxes for the

year which are due each July 1st and are calculated for

the calendar year

Sales Tax Currently GST is charged on new homes in British Columbia. Rebates may be available and most lenders will finance net-GST. For more information please visit Canada Revenue Agency's web page on New Housing Rebates. Home Inspection This is probably the best $300- $500 you will ever spend. Typically Lenders will not require you to obtain a home inspection however it is highly recommended that you have a home inspected whenever possible, so that you're completely informed about what you can't see behind the walls. There may be mould, old wiring or leaks that will cost you a lot to fix down the road. Mortgage Fees Mortgage Brokerage and/or a Lender fees on a typical mortgage will not apply. However, in the case of a more complex or in the case of private financing fees may apply. The fees are disclosed upfront and outlined in the mortgage commitment prior to closing. Other Costs to Consider Other costs may apply when purchasing a home. Costs associated with the mortgage will be presented prior to your mortgage closing date. Other costs to consider are strata fees, moving expenses, utility hook-ups, change of address expenses and more. 
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