We will inform you in advance of “closing costs” in addition to your down payment for your dream home. These various charges can add up and for the most part they are all legally required payments in buying a property.
A lawyer or notary public is an essential part of your home-buying team, as the work provided involves legal fees. Most legal fees include searching the title of a property, arranging a property survey if necessary, and handling other disbursements as required.
Mortgage insurance and application fee
For any high ratio mortgage, which is any mortgage in which 80 per cent or more of the house’s purchase price is covered by the mortgage, the lender requires mortgage insurance. This amount is generally factored into your mortgage payment.
This insurance covers the replacement value of your home and its contents. Most mortgage lenders will require proof that you have this insurance before processing a mortgage.
A professional home inspector knows what to look for and can confirm or add to the information you have gleaned from the sales information or your inspection.
Property transfer tax
This provincial tax is payable at the rate of one per cent on the first $200,000 of the purchase price and two percent on the balance. Some exemptions may apply, including for first-time home buyers.
GST is payable to some degree on the purchase price on all new homes, although partial rebates are available on the purchase of most homes. A resale residential home is usually exempt from GST. An excellent resource is the BC Real Estate Association’s online tax calculator
Other charges may apply however these must be specifically documented in your purchase contract
View our Closing Cost Worksheet for a better idea of what to expect
Why isn’t Possession Date the same as Completion or Closing Date?
The Possession Date is traditionally 12:00 noon the day after Completion.
Why is this? Virtually every home seller is moving to another home and relies on the funds from their house to move to the next. Lawyers and the Land Title Office will not guarantee Title Transfer anytime prior to end of business day. On very rare occasions (ie. vacant homes) it may be possible to negotiate Possession at 5pm or later Closing Day.
What happens if I am currently renting?
If you are currently renting as a tenant, the Residential Tenancy Act stipulates that you must vacate your rental property at 1:00pm on the last day of the month. What this means is that you may be homeless for the time between 1:00pm the last day of the month and 12:00 noon on possession.
-Be prepared for interim accommodation for the evening and storage if needed.
-Consider setting a Closing Date mid month (ie. 15th or closest weekend to the middle). This way, you’ll have both properties for 2 weeks allowing you to take your time moving or to do any necessary upgrades or renovations. There will be an interest adjustment for these additional days however your first mortgage payment will not occur until the last day of the following month meaning no rent/mortgage will be due on the first day of the month. Contact your mortgage representative for more details.
How do I get the key to my new home? How many keys will we get?
As your agent, we will organize the key transfer.
We always suggest re-keying the locks as one can never know how many keys are in circulation. If you are handy, simply remove the deadbolts and knobs and take them to a locksmith to get re-keyed at the shop; you will save on service call costs. If you’re not handy, the cost will be worthwhile.
What condition can I expect my new home to be in?
You should be prepared to give your new home a good cleaning when you move in. ‘Cleanliness’ often has different meanings to different people hence the reason why it is impractical to specify that the house will be clean at closing. Be prepared for the worst and you will likely be pleasantly surprised.
To remind you and to confirm crucial dates, we will issue you a Closing and Possession Schedule.