Buying your first home is an exciting process. You determined how much home you can afford, you saved your down payment, you and your REALTOR® found the perfect home and your offer was accepted. While the purchase price of your home is the largest cost you will encounter, there are other costs to prepare for when buying a home. It's a good idea to budget some extra cash to cover the cost of obtaining a mortgage and "closing" your real estate transaction. Here are some of the extra cost items you should consider: Appraisal fee
Mortgage lenders will usually loan a percentage of the home's purchase price or the market appraisal of the property, whichever is lower. The appraisal is either done by someone on the lender's staff or by an outside professional approved by the lender. The cost of the appraisal is most often the responsibility of the home buyer. Application fee
Find out whether or not your lending institution charges to process your mortgage application. In many cases, if you are dealing with a bank that you have other accounts with, they will waive the application fee. Land survey fee
Lenders require a plot plan or survey of the property you intend to buy. On properties located in subdivisions in urban areas, lenders will often accept an existing survey, depending on when it was done. However, if there is no existing survey, be prepared to pay a substantial fee for a new survey. Home inspection fee
Many homebuyers choose to have a home inspection done prior to finalizing their offer to purchase. I always encourage my buyers to hire a home inspector, even if the home looks like it has been beautifully maintained. No one likes surprises shortly after they move in. Most inspectors will find several little things wrong with a home, but these are not deal-breakers. Look for problems with the big-ticket items such as requiring a new roof, furnace, basement leaks etc. Don't sweat the small stuff, every home has some sort of small problem areas. Some lenders require a professional home inspection as well and they will inform you of that requirement. Legal fees
You will need to pay your lawyer to arrange your mortgage as well as for "disbursements" such as title search, drawing up the title deed and preparing and registering the mortgage. Land transfer tax
This tax is payable by anyone who purchases property in Ontario. A REALTOR® or lawyer can help you calculate how much tax you will pay on your purchase. For more information on the Ontario Land Transfer Tax and the newly implemented Toronto Land Transfer Tax, please click on this link to calculate the required taxes. GST
If you are buying a new home, you will be required to pay Goods and Services Tax of six percent on the price of your home. GST does not apply to most resale homes. Insurance
There are several types of insurance that may be required when buying your home. If you are arranging a "high-ratio" mortgage (less than 25% down payment) you will need to purchase mortgage insurance. Mortgage lenders require you to carry fire and extended coverage insurance that exceeds the amount of the outstanding balance of the buildings. Other insurance you may want to consider include title insurance and life insurance. Other costs
You will likely have to make property tax adjustments and interest adjustments on utility bills, heating oil etc. I would be pleased to explain these additional costs so you won't have any surprises on closing day. Maintenance and utility costs
Finally, be sure to budget for heating, electricity, water and any immediate renovations you may have planned. Perhaps it would be a good idea to put aside any spare cash and contribute regularly to a "maintenance fund" so you will be prepared for any repairs or upgrades you may need to make in the future. If you would like more information regarding closing costs, I would be pleased to discuss them with you. Please call Liz Gordon, Sutton Group Admiral Realty Inc. at (416) 739-7200 or drop me an email at egordon@trebnet.com. I look forward to hearing from you. Source: Ontario Real Estate Association | 
