Closing Costs When Purchasing Vancouver Real Estate
Not all of your cash savings can be used as your down-payment when buying a home in Vancouver, British Columbia. There are additional costs such as taxes, legal fees, appraisal fees, moving expenses, home insurance, etc that must be paid before you take occupancy of your new home. Budgeting for these Closing Costs now, is a must and will avoid stress in the future. ...and worse case scenario could keep you from completing on your new home.
You will be required to pay some, or perhaps all, of the following expenses:
(All prices and rates indicated are approximate and should be verified to your own satisfaction, and there may be additional costs not listed)
Harmonized Sales Tax – If you purchase a newly constructed home, or extensively renovated property, you may be subject to HST on the purchase price.
The provincial and federal governments, as of July 1, 2010, have combined the 7%
provincial sales tax (PST) and the 5% federal Goods and Services
Tax (GST) into the 12% Harmonized Sales Tax (HST). You may be eligible for a provincial New Housing Rebate
Property Transfer Tax (PPT) – The British Columbia Provincial Government imposes a property transfer tax which must be paid before any home can be legally transferred to a new owner. The current Property Transfer Tax rate is 1% on the first $200 000 and 2% on the remainder. For more information please visit:
http://www.sbr.gov.bc.ca/business/Property_Taxes/Property_Transfer_Tax/ptt.htm
If you are purchasing your first home, you may qualify for a Property Transfer Tax Exemption
if certain requirements are met. http://www.sbr.gov.bc.ca/business/Property_Taxes/Property_Transfer_Tax/first_Time_home_buyer.htm
Legal Fees – The transfer of home ownership from the seller to the buyer must be recorded in the Land Title Office, and this can only be accomplished by a Notary or a Lawyer.
(Approximate costs are $800-$1500)
Home Inspection - When purchasing any type of property it is extremely important to have it inspected by a qualified and licensed home inspector.
Approximate costs are $200-$600 dollars depending on the size and age of the home.
Property Tax – If the current owner has paid the property taxes for that year to the municipality, you will have to reimburse them for your proportional share of the taxes.
(Taxes paid/ 365 X number of days remaining in the taxation year = your proportional share)
Mortgage Default Insurance – This form of insurance is required on most mortgages in excess of 75% of the appraised home value. Its purpose is to insure that the lender against any loses if you default on your mortgage payments and the value of your home is not sufficient to repay your mortgage debt. The insurance premium is paid to the lender and, in most cases, is added to the loan amount and paid for over the term of the loan.
Mortgage Application Fee – Lending institutions may charge a mortgage application fee. This application fee may vary between lending institutions and individual clients.
Appraisal Fee – Some lending institutions may require an appraisal of the home before approving your loan, it may be your responsibility to pay the appraiser’s fee.
Survey Fee – Lending institution may require a survey certificate be presented to them. The purpose of the survey is to establish the boundaries of the property and/ or all buildings are within those boundaries.
(Lending institutions may ask for a building location survey, which establishes where a building is located on a property, or a monumental survey, which establishes the boundaries of the property. If the current owner cannot provide a recent survey certificate, it will be your responsibility to obtain one and pay the surveyor’s fee.)
Life & Disability Mortgage Insurance – At your option, you may purchase insurance which will ensure that your outstanding mortgage balance is paid if you die or become disabled.
Fire & Liability Insurance – Your bank will require you to purchase a insurance which guarantees that, in the event of fire, the lender will receive the balance owing on the mortgage loan before you receive any insurance proceeds.
Other expenses that must be considered are moving costs, home decorating/ renovation costs (paint, flooring, etc), the purchase of new appliances, etc.
Closing Costs: When Purchasing Vancouver Real Estate not all of your cash savings can be used as your down-payment when buying a home in Vancouver, British Columbia. There are additional costs such as taxes, legal fees, appraisal fees, moving expenses, home insurance, etc that must be paid before you take occupancy of your new home. Budgeting for these Closing Costs now, is a must and will avoid stress in the future. ...and worse case scenario could keep you from completing on your new home.
You will be required to pay some, or perhaps all, of the following expenses:(All prices and rates indicated are approximate and should be verified to your own satisfaction, and there may be additional costs not listed)
Harmonized Sales Tax – If you purchase a newly constructed home, or extensively renovated property, you may be subject to HST on the purchase price. The provincial and federal governments, as of July 1, 2010, have combined the 7%provincial sales tax (PST) and the 5% federal Goods and ServicesTax (GST) into the 12% Harmonized Sales Tax (HST). You may be eligible for a provincial New Housing Rebate
As a rule of thumb, the old GST rules now apply to the HST when it comes to the purchase of residential
property.
New Housing Rebate
You may be eligible for a provincial New Housing Rebate
if they buy, as their primary residence:
a new home • together with land;
• a new home together with leased land;
• a new mobile home or float home;
• a home you buy through shares in a housing cooperative; or
• a home constructed or substantially renovated (more than 90%)
by the owner-builder.
Buyers of new homes will be eligible for a rebate of 71.43%
of the provincial portion of the HST paid on the new home up
to a maximum rebate of $26,250. Homes prices at more than
$525,000 will be eligible for a flat rebate of $26,250.
CMHC fees - (mortgage loan insurance) The CMHC Mortgage Loan Insurance premium is calculated as a percentage of the loan and is based on the size of your down payment. The higher the percentage of the total house price/value that you borrow, the higher percentage you will pay in insurance premiums. This applies if less that 20% is placed as a down payment.
Application fee 3.25% of the mortgage (premiums/fees subject to change).
If you put down 10% or 15%, insurance fees decrease to 2% and 1.75% respectively.
Application fee of $235 or $75 + appraisal at Buyers cost.
For more information please visit Canada Mortgage And Housing Corporation.
Property Transfer Tax (PPT) – The British Columbia Provincial Government imposes a property transfer tax which must be paid before any home can be legally transferred to a new owner. The current Property Transfer Tax rate is 1% on the first $200 000 and 2% on the remainder. Please visit BC GOV for more information.
If you are purchasing your first home, you may qualify for a Property Transfer Tax Exemption if certain requirements are met.
Legal Fees – The transfer of home ownership from the seller to the buyer must be recorded in the Land Title Office, and this can only be accomplished by a Notary or a Lawyer.(Approximate costs are $800-$1500)
Home Inspection - When purchasing any type of property it is extremely important to have it inspected by a qualified and licensed home inspector. Approximate costs are $200-$600 dollars depending on the size and age of the home.
Property Tax – If the current owner has paid the property taxes for that year to the municipality, you will have to reimburse them for your proportional share of the taxes. (Taxes paid/ 365 X number of days remaining in the taxation year = your proportional share)
Mortgage Default Insurance – This form of insurance is required on most mortgages in excess of 75% of the appraised home value. Its purpose is to insure that the lender against any loses if you default on your mortgage payments and the value of your home is not sufficient to repay your mortgage debt. The insurance premium is paid to the lender and, in most cases, is added to the loan amount and paid for over the term of the loan.
Mortgage Application Fee – Lending institutions may charge a mortgage application fee. This application fee may vary between lending institutions and individual clients.
Appraisal Fee – Some lending institutions may require an appraisal of the home before approving your loan, it may be your responsibility to pay the appraiser’s fee.
Survey Fee – Lending institution may require a survey certificate be presented to them. The purpose of the survey is to establish the boundaries of the property and/ or all buildings are within those boundaries.(Lending institutions may ask for a building location survey, which establishes where a building is located on a property, or a monumental survey, which establishes the boundaries of the property. If the current owner cannot provide a recent survey certificate, it will be your responsibility to obtain one and pay the surveyor’s fee.)
Life & Disability Mortgage Insurance – At your option, you may purchase insurance which will ensure that your outstanding mortgage balance is paid if you die or become disabled.
Fire & Liability Insurance – Your bank will require you to purchase a insurance which guarantees that, in the event of fire, the lender will receive the balance owing on the mortgage loan before you receive any insurance proceeds.
Other expenses that must be considered are moving costs, home decorating/ renovation costs (paint, flooring, etc), the purchase of new appliances, etc.