Don’t Get Caught Off Guard: Understanding Closing Costs in Canada
Imagine this: you’ve found your dream home, secured your mortgage approval, and you’re excited to pick up the keys. Then—out of nowhere—your lawyer hands you a bill for thousands of dollars you didn’t budget for. Unfortunately, this scenario happens far too often. But with the right preparation, it doesn’t have to happen to you.
When you buy a home, the purchase price isn’t the only cost. There are also closing costs—administrative expenses, taxes, and professional fees that must be paid out of pocket, in cash. Unlike your mortgage, these cannot be rolled into your loan.
Let’s break them down.
1. Land Transfer Taxes
This is one of the biggest closing costs buyers face. It’s a provincial tax (and in some cases, an additional city tax) charged when the property title is transferred into your name. The amount is calculated as a percentage of your purchase price, and it can add up quickly—ranging from thousands to even tens of thousands of dollars depending on the value of your home and your location.
2. Legal Fees
In Canada, you’ll need a lawyer to complete your real estate transaction. They handle the paperwork, ensure everything is done properly, and protect your interests. But their expertise comes at a cost, and these legal fees need to be factored into your budget.
3. Other Costs You Might Overlook
Beyond the big-ticket items, there are several smaller but necessary expenses that can creep up during the process. These include:
- Appraisal fees – required by your lender to confirm the property’s value.
- Home inspection costs – for your peace of mind before finalizing the purchase.
Individually, these may seem minor, but together they add up quickly.
Why Planning Ahead Matters
The difference between a smooth, stress-free home purchase and a last-minute panic often comes down to whether or not you’ve accounted for these expenses in advance. By understanding your closing costs, you’ll avoid surprises and feel confident walking into your new home.
Let’s Map It Out Together
Every province and municipality has its own rules and rates, so your exact closing costs will depend on where you’re buying. If you’d like a personalized breakdown—specific to your purchase price and location—I’d be happy to help.
👉 Schedule a call with me and I’ll walk you through every single dollar, so you can buy your home with confidence and no surprises.
"I'm blown away at the lack of options that people receive when they go directly to the bank and some mortgage brokers. Often the conversation just simply consists of, 'Hi, I'm looking to get pre-approved,' and in turn, what's provided to them is simply a pre-approval mortgage amount and max purchase price and an interest rate."
