Information on Mortgage Closing Costs
There is something little more than making your monthly mortgage payments when it comes to owning your home. Closing costs are onetime charges you will have to pay. In this regard, some of the following categories might be applicable to your home purchase depending on your plan, situation and the type of property you purchase.
How to Approach Closing Costs
If your mortgage down payment is less than 20% of the purchase price, then you will have to pay mortgage insurance premium and the Provincial Sales Tax (PST) at closing. Usually, these charges will be added to your mortgage balance.
Depending on the type of property you have purchased, you may be required to pay the appraisal fee to the independent appraiser we have hired to decide whether the value of your property meets the lending criteria.
Interest Adjustment Costs
Interest adjustment costs might apply in your case depending on the condition. Usually, you need to make the first mortgage payment one month after closing the home purchase. If the deal closes mid-month, then you will have to make the first payment or the interest accrued during this time period, whichever is applicable in your case. This is payable at the beginning of the next month, i.e., two weeks before you would usually expect.
Notarial Charges on Mortgages
Legal or notarial fees and disbursements may apply in your case. You will be required to have a lawyer or notary to act on your behalf while purchasing and mortgaging your property. You are responsible for making all the related fees and disbursements in this connection. Since different lawyers and notaries charge differently for this service, it is advisable you choose the right person for your needs.
Title Insurance Policy
You will have to spend on title insurance policy that is meant to protect you as the homeowner against the possible threats to the ownership of your home or from the problems related to the title to your home. During the discussion with our professionals, they can suggest you whether you will need this policy depending on your specific case.
In some cases, township or municipality levies are applicable to some new homes within subdivisions. These items might include tree planting, school taxes and other items.
You may have to incur property tax or utility bills adjustment costs. Subject to the usual adjustments at closing, the purchase price of a resale home must be paid. The implication here is that any amount that the seller has prepaid towards the abovementioned categories will be adjusted letting you pay the excess amount back to the seller and vice versa. Property taxes and utility bills that have been paid ahead of time are the usual adjustments made while deciding on the closing costs.
Various Other Factors adding to Closing Costs
Certificate of location is required for approving your mortgage. Your lawyer or notary might also need this certificate for transfer of ownership. You need to ensure that this certificate clearly reflects improvements including decks, patios or pools. If you are buying a newly constructed home, then items like hardwood flooring, granite kitchen countertops, additional ceiling heights and others might increase the purchase price of your property.
Canada MGC Experts Handle Nitty-Gritty of Closing Costs
Let our Canada MGC experts handle all the closing costs related to mortgage. For any clarifications on the above said categories, you may contact us and we can give you a clear picture of the closing costs applicable in your case depending on your specific situation.
Call 1-866-963-CMGC (2642) for the detailed mortgage closing costs. Our experts help you achieve instant mortgage approval.