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Be Aware of the Hidden Costs of Buying a Home
By Ann Smith
Too
many first time home buyers only consider the listing price when
determining their monthly mortgage payments. They may go online, find a
mortgage calculator, and figure out how much they can reasonably afford to
pay each month, and then start looking for homes to fit their budget.
But
when it comes time to “close” on the perfect home, they could be in for a
rude awakening if they haven’t factored in the additional expenses that
quickly add up. You can’t afford to overlook the hidden costs associated
with buying a home.
Regular home
maintenance costs are a big consideration when planning a budget before
handing over the down payment, especially if a home is in need of major
repairs such as a new roof, plumbing or electrical updates, or foundation
work. But the hidden costs are the extra fees you’ll pay at closing, which
include, but are not limited to:
-
Home appraisal fee
(some lenders pay this).
-
Mortgage life insurance.
-
Ontario Land
Transfer Tax, which varies with the property’s purchase price.
-
Lawyer’s fees and
disbursement costs.
-
Property survey or
title insurance if you don’t obtain a survey.
-
Home inspection
fees.
-
Interest adjustments, which
covers
any interest accrued between the closing date of the purchase and the
first regular payment date of the mortgage.
-
Increased municipal
taxes if paid to a mortgage lender.
-
GST and PST
depending on the
type of property being purchased.
-
Real estate
commissions.
-
Utilities deposits
and service charges for hook ups and disconnects.
-
Moving costs.
Talk to a
professional real estate agent before you begin your search for the perfect
home. She can reveal all the hidden costs up front so you don’t receive
any unexpected surprises.
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