Closing Costs in Ontario: What to Expect (and How to Plan for Them!)
So, you’ve found your dream home, your mortgage is approved, and you’re ready to close the deal. But wait—what about closing costs? These are the extra expenses that come with finalizing your home purchase, and they can add up to 1.5% to 4% of the purchase price.
Don’t worry! I’m here to break it all down so you know exactly what to expect (and how to budget for it).
- Land Transfer Tax (LTT)
What It Is: A tax paid to the province when ownership of a home is transferred.
How Much? It’s calculated based on the home’s price:
- 0.5% on the first $55,000
- 1% on $55,001 – $250,000
- 1.5% on $250,001 – $400,000
- 2% on $400,001 – $2,000,000
- 2.5% on amounts over $2,000,000 (for single-family homes)
First-Time Buyer Perk! If you’re a first-time homebuyer, you could get a rebate of up to $4,000 to offset this cost.
Buying in Toronto? Expect to pay an additional municipal land transfer tax (but first-time buyers get a rebate here too).
- Legal Fees ️
What It Covers: Your lawyer ensures the purchase is legally sound, handles the title search, registers documents, and takes care of all financial transactions.
Cost: $1,000 – $2,500 (including disbursements like title registration and courier fees).
- Title Insurance
What It Is: Protects you and your lender against fraud, title errors, and hidden liens.
Cost: A one-time fee of $250 – $400.
- Home Inspection (If You Choose One)
Why It’s Important: A home inspection can reveal potential issues before you finalize your purchase.
Cost: $300 – $500, depending on the size and location of the home.
- Appraisal Fee
What It Is: Your lender may require an appraisal to confirm the home’s value before approving your mortgage.
Cost: $300 – $500 (though some lenders cover this!).
- Mortgage Insurance (If Your Down Payment Is Less Than 20%)
What It Is: If you’re putting down less than 20%, you’ll need mortgage default insurance from CMHC, Sagen, or Canada Guaranty.
How Much? The premium is added to your mortgage, but the PST (8% of the premium) must be paid upfront.
- Adjustments for Prepaid Costs
What It Covers: Reimbursements to the seller for prepaid property taxes, utility bills, or condo fees.
Cost: Varies depending on what’s already been paid. Your lawyer will calculate this for you.
- Moving Costs (If You’re Hiring Help!)
What It Includes: Hiring movers, renting a truck, or paying for short-term storage.
Cost: $500 – $2,000, depending on distance and how much you’re moving.
- Other Possible Costs to Keep in Mind
✔ Home Insurance: Required before closing (costs vary).
✔ HST on New Builds: If buying a brand-new home, HST may apply (but rebates exist for primary residences).
✔ Status Certificate Fee (for Condos): Typically $100 – $200.
How I Can Help You Plan for Closing Costs
As a mortgage broker, I don’t just help you get the best mortgage—I also make sure you’re fully prepared for closing costs so there are no last-minute surprises.
✔ I’ll provide an estimate early in the process so you know what to budget for.
✔ I’ll ensure your mortgage approval considers these costs so you’re financially prepared.
✔ I’ll guide you through available rebates (like the first-time homebuyer land transfer tax rebate) to help you save.
Final Thoughts: Be Prepared & Stay Stress-Free!
Closing costs are an important (but sometimes overlooked) part of buying a home. By planning ahead, you can make sure you have enough set aside for a smooth, worry-free closing day.
Got questions? Let’s chat! I’m here to help every step of the way.
Call: 905-929-1199
Email: lamalfi@tmacc.com
Serving: Ancaster, Hamilton & All of Ontario
Let’s make your home-buying experience easy and stress-free!