Amount to Spend When Purchasing a Home
Buying a house is an expensive investment that can make you spend more than you could have expected. The closing cost is what make this process to be expensive because many people are not prepared about it. These many costs to be paid after you have done everything can make you broke after buying the home. This page will prepare you with the cost that you will incur when buying a home.
The meaning of closing costs. The closing costs means the fees that will be incurred to cater for the title deeds, broker fee, land transfer, and legal fee and many more fees. Continue reading here to see how much you can spend on each of these.
The fee charged for the land transfer. The fee charged for land transfer depends on the province you are dealing with and it’s expected to be a percentage of the home buying cost. In some areas, the cost is not imposed to first time home buyers.
Definition of the legal fee. The legal cost is the amount that goes with the real estate lawyer for overseeing that everything goes as expected. The amount spent in this care differs but although it’s advisable to engage real estate lawyer when buying a home, there are still some people that ignore it to save on the cost.
Then, let’s look at the PST on CMHC insurance. If you didn’t have 20 % of the first payment for the home then you will have to take a loan and that’s what leads to this kind of fee. The PST on CMHC insurance acts as the security to the money lender if you fail to pay the loan back. You don’t have to worry about the amount you will have to pay since it can be spread throughout the loan period but you will have to pay a certain amount to the PST on CMHC insurance for tax.
The other closing fee to consider. There are other closing costs that are dependent on the home that you are buying.
The septic. Ensure you have hired a septic tank repair professional to test the status of the septic. You are now good to ask for the documents from the owner through the offer to purchase process so that you will own it.
Water cost. Also, you need to make sure that you have checked the condition of the well and the quality of the water before you place an order to purchase it from the homeowner.
Post-closing day . You are still going to pay other costs after settling everything else.
The property insurance and property tax are other extra cots after closing day. The property tax is what you will pay for the house on monthly basis and it depends on where you are located. The property insurance is also made monthly as it’s meant to protect you from any damages.