Other Expenses

When purchasing a home and applying for a mortgage, the borrower incurs certain costs associated with that purchase. Such as: (but are not limited to)

Adjustments and Disbursements: On closing, your lawyer will make certain adjustments and disbursements to the purchase price. There are prepaid expenses, which will need to be pro-rated between the vendor and the pruchaser. For instance, a typical adjustment deals with the property taxes paid to the City or Muniipality. The amount of prepaid taxes will be adjusted as of the closing date and one party will be required to reimburse the other.

Application fee: Some lenders charge an application fee to process the application. These application fees are generally assiciated with non-conforming mortgages. There may be paid up front or deducted from teh mortgate advance.

Appraisal fee: An appraisal is needed to verify the value of the property beng mortgaged. The lenders use an independent, certified appraiser to evaluate the property. This cost is payable by the borrower.

GST: Good and Service Taxes are only payable on newly constructed homes, vacant land (sold by developer) and commercial properties. Not on resales.

Land Transfer Tax: This is a sales tax on the purchase of your home. The amount differs from province to province.

Legal Fees: These fees are paid to your lawyer for registering the mortgage and to cover any of his related costs (called disbursements). These disbursements vary and it is best to get a quote from your lawyer. The Land Transfer Tax is also payable as part of the disbursements on closing.

Mortgage Specialist/Broker: If you are using a mortgage specialist/broker to arrange your mortgage, check to see if the broker is charging you for his/her service. Most brokers do not charge to arrange your mortgage becasue they are paid a referral fee from the lender. A broker fee may be applicable under specific circumstances due to the nature of the applicant or property. Impaired credit, non- conforming properties, and commercial properties are some examples where a fee may be charged. Also check if your mortgage speicalist is an Accredited Mortgage Professional (AMP). The AMP designation sets a new industry standard and offers peace of mind to you and your family.

Survey: Generally, a lender will require a survery to confirm that the house does not encroach or cross over the property lines. A vendor will often already have a survey, especially if the vendor has a mortgage on the property. If the survey is up-to-date and acceptable to the lender, it will not be necessary to get a new one.

Title Insurance: In liew of an up-to-date survey , some lenders will offer title insurance. Their commitment to insure your mortgage is obtained through your solicitor. All costs in obtaining such insurance will be your responsibility. The estimated costs is $200 plus GST.