Most first time home buyers begin saving for their first homes with only the expenses of the down payment and mortgage payments in mined. For many, there can be some unexpected costs that can occur.
Some costs will be paid at the beginning of the home buying process, and others will have to be paid at the end (these costs are known as closing costs). We've outlined what costs are involved in a home sale so you can start the home buying process without encountering unexpected expenses.
Home Inspection Fee
A home inspection fee is paid when a home inspector comes into the home you've purchased and evaluates the structures and systems of the home. The inspector will then provide you with a written report of the house.
This is not a mandatory step of the home buying process. However, many people expect a professional home inspection and make their offer conditional on the inspection. This fee typically costs approximately $500.
Land Transfer Tax
The land transfer tax is charged whenever a property changes ownership, and the price varies based on location. In Canada most provinces charge a provincial tax, and some cities add an additional municipal tax.
Your legal fees will also vary based on location, and depending on location are also subject to GST and HST. You will need to obtain a quote from a lawyer that includes all expenses and disbursements, not just the cost of the legal fees alone.
Legal fees are an important expense you should not skip, because your lawyer will have your best interests in mind when looking over your Offer of Purchase. You should set aside approximately $1,300 - $2,500 to retain a lawyer when buying a home.
In order to get approved for a mortgage, some lenders require that you get an appraisal on the property before purchasing. Depending on which bank you've chosen this may be covered by them or may be at your expense.
If this is at your expense, it typically costs about $150-200.
Your moving costs are surprisingly something that can be easily overlooked. Factor in how far away you're moving to, and whether you'll need to hire a moving company. This needs to be budgeted for within this process.
If you're a first time home buyer, it's also important to factor in whether you have everything you need for the home, to have it furnished and ready for when you move in.
Don't let this overwhelm you. You've already made a great decision by choosing to buy a home in Niagara. By going into the home buying process prepared and ready to take on these costs, you will be able to enjoy the process and find your perfect home.