When purchasing a home, there are several fees you have to understand and factor into your budget before you hit the closing table. Here’s what you need to know.
What are closing costs?
Closing costs are the fees for services required to finalize your mortgage. Fees include (but certainly are not limited to) lawyers, appraisal, inspection, government taxes, title insurance, home insurance, mortgage insurance, and property taxes.
How much are closing costs?
Closing costs usually total about 2 to 5 percent of the home’s purchase price, and they generally vary depending on the property purchased and province you reside in. Your lender will provide you with an estimate of your closing costs following your loan approval, and although that number can change slightly, your final costs should be similar.
Being prepared for the costs before they surprise you will make the purchase or sale of a home go more smoothly. Ask your lender, lawyer and real estate professional for any advice.