Closing Costs - How Much More Does it Cost to Buy a Home?

http://LeahCoss.ca
Hi, everyone? How are you? It's Leah Coss with The Mortgage Center, and I wanted to a really quick post on closing costs. Oftentimes, people will come to me and just to make number easy, say, "Oh, we're looking to buy a $100,000 home. We've got our 5% down payment. What else do we need?" Well, what they haven't accounted for is that there's always going to be closing costs.
Now, for first time home buyers, you've got it off a little bit easy. All you're going to have are legals, if you choose to have a home inspection on the place and that's up to you.
Typically, you're not going to need an appraisal, but if you happen to come up with more than 20%, then you will most likely always have to have an appraisal. That will cost you about $260. Legal is about $800 $1200.
But you won't have to pay the property transfer tax, which is the biggest expense of all of them. And here's my dog to interrupt this post, as usual. Stay down.
So with everyone else, though, you are going to have closing costs. And what is the rule of thumb? Well, even some banks mandate this, but they'll say, "Where's your down payment?" and we'll say, "Oh, here's the 5%, or 10% or whatever you're putting down."
But if you only have 5%, they're going to say, "OK. That's awesome. Show us another 1.5%." 1.5% is a good estimate as to how much your closing costs are going to be when you purchase the home.
So keep that in mind. If you have 5% down, you're actually going to need about 6.5% down, or in your pocket anyway, accessible so that you can pay for all the closing costs.
If you have any questions about these expenses or anything else, as always, give me a call. I'm Leah Coss with The Mortgage Center. Hopefully, I will be talking to you soon.
http://LeahCoss.ca

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