Land Transfer Tax, Twice
Toronto buyers pay both the Ontario land transfer tax and a separate Toronto municipal land transfer tax. Together these can be one of the largest closing costs on top of your down payment, though first time buyers may qualify for rebates on both.
Legal Fees and Title Insurance
You will need a real estate lawyer to handle the closing, review the title, and register the mortgage. Budget for legal fees plus disbursements, and most lawyers will also arrange title insurance to protect against ownership disputes or survey issues.
Home Inspection and Appraisal
A home inspection before you finalize your offer is a cost worth budgeting for, along with a lender-ordered appraisal that may be charged to you directly or built into your mortgage costs.
- Home inspection fee
- Appraisal fee
- Status certificate review for condos
Adjustments and Prepaid Costs
On closing day you reimburse the seller for prepaid property taxes or utility deposits calculated up to the closing date. This adjustment amount varies by property and is calculated by your lawyer.
A Simple Rule of Thumb
Many Toronto buyers budget roughly 1.5 to 4 percent of the purchase price for closing costs, though the exact figure depends on your rebate eligibility and property type. Talk to your lawyer early so there are no surprises.
Frequently asked questions
- Are closing costs included in my mortgage?
- Generally no, closing costs are paid separately from your down payment and mortgage funds.
- Can first time buyers reduce land transfer tax?
- Yes, eligible first time buyers can receive rebates on both the Ontario and Toronto land transfer taxes.
- When are closing costs due?
- Most closing costs, including legal fees and land transfer tax, are due on or before your closing date.