What Are Your Real Closing Costs?

What are closing costs?

What are Closing Costs?

Congrats! You saved for a downpayment and now you are ready to buy. The mortgage and downpayment cover the purchase price of the home. There are other costs involved with purchasing a home, referred to closing costs.

Consider these when you are budgeting for the full cost of your purchase


If you are purchasing a private sale, you will require an appraisal. If you are purchasing a home with 20% down, chances are you may need an appraisal as well. Approx. cost $250-$350.

Home Inspection:

Whether you are buying a brand new home or an older one, it is important to get a home inspection done to see if there are any issues that may arise. Approx $500.

Legal Fees & related expenses:

This includes legal fees for the purchase and other disbursement fees. Be sure to get quoted on disbursement charges. Approx $1300-$2500

Title Insurance:

Lender’s title insurance is usually required to get a mortgage loan. Title insurance protects your lender against problems with the title to your property—for example, if someone sues to say they have a claim against the home. Lender’s title insurance does not protect your investment in the home (your equity). Approx $250-$350.

Land Transfer Registration:

Alberta does not have a large land transfer tax like most provinces in Canada. Instead, it has a much smaller land title transfer fee. The rates for the two parts are as follows: $50 base plus $1 for every $5000 of property value.

Property Tax Adjustment:

If you are buying a home, there is a good chance that you will incur a Property Tax Adjustment in order to complete your real estate transaction. A Property Tax Adjustment ensures that you do not over or under pay property tax; it ensures that you pay the correct amount of taxes actually incurred by you. If the seller has paid the full tax bill in June and you take possession in Sept, you will be responsible to reimburse the seller for the dates in Sept to December 31.

Interest adjustments:

You will need to pay interest on any gap between the closing date of the purchase and the first payment date of the mortgage.Lawyers routinely collect interest adjustments at closing. Confirm this when you discuss your closing costs with them.
Keep in mind, it is possible to avoid interest adjustments altogether. To do so, you need to schedule your first mortgage payment exactly one payment period (e.g. one month) after your closing date.

Home Insurance:

Get a couple different quotes. Often you can pay home insurance on a monthly basis.


Some utility companies may require a deposit to start a new account.

For more mortgage information, visit www.jacquelinemortgages.com or contact Jacqueline Jeffries at 780.220.5968.