Understanding Your Closing Costs
Simply put, closing costs are all the fees charged by title companies, banks, lenders, and others who help you through the process of buying your home. These closing cost fees are added to your home purchase price.
However, here are a few of the most common fees that are included in the closing costs of buying your home:
Lawyer's fees – These fees vary across Canada, and the Hamre Team can refer you to a lawyer who offers a competitive legal package.
Title insurance – These may be purchased in lieu of a land survey in some cases. They provide protection against several defects such as problems with the property that would have been revealed by an up-to-date land survey.
Land transfer tax – Buyers must pay this tax to their provincial government when the property's title passes from the seller.
High ratio mortgage insurance – This insurance is needed if you are buying a home for less than 20% down.
Realtor fees are most often paid by the seller, so those fees are not included in closing costs.
How much are closing costs?
On average, you should estimate that these fees will total up to 4% of your total loan amount. If you want a better estimate of your closing costs, you should contact your lender and ask for an estimate.
As we mentioned, the closing costs can also include a variety of other fees, but the Hamre Real Estate Team is here to walk you through the process of buying your home and helping you to easily understand your home closing costs.
If you have any questions about the closing costs of your home, contact us today!
Image courtesy of Duckiemonster, Flickr.