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Fees And Closing Costs Explained

FEES AND CLOSING COSTSThere are a number of costs associated with buying a house in the Halifax area. Here is a summary of most of them:Legal fees– You will need a lawyer to complete the purchase of your home. Legal fees vary from lawyer to lawyer but on average it is safe to allow $650 – $800 for legal fees and another $300- $400 for disbursements such as registering the deed etc. The legal fees for a purchase of a $100,000 home would be about $650 for the lawyer and $350 for disbursements for a total of $1000.Deed Transfer tax– The municipality the home is located in will charge a fee to transfer the deed into your name. In most of the metro area this fee is 1 1/2% of the purchase price of the home. For example in a $100,000 purchase you would pay $1,500 deed transfer tax. This tax is paid on closing to your lawyer who then pays the municipality.

Mortgage application fees– There are sometimes fees for applying for a mortgage and an appraisal of the property you want to purchase.If you are borrowing more than 75% of the value of the property there will be fees for sure. These fees vary but count on about $300 – $400. This is paid to the lender at time of mortgage application.

Moving costs– There will be some cost to move to your new home. If you are moving a long distance get a number of estimates before deciding on the moving company. Even a local move will cost you.

Building Inspection Fee– It is a must to have the property you are buying inspected by a professional inspector. They will check out the home for structural soundness. The cost for this service for Amerispec for example as of Jan 2008 is about $399 incl tax but varies from inspector to inspector.

Power and telephone hook ups– Allow for the cost to reconnect your telephone and power. Allow $75 each for these.

Tax adjustment– The owners of the home you are buying have paid yearly taxes the municipality. You will be required on closing to reimburse them for the taxes they have prepaid for the year. For example if they had paid $2,000 for the whole year and you were closing June 30th you would be required to pay the owner half of the taxes prepaid or $1,000. Count on 1/2 a year’s taxes and you will be more than safe.

Fuel adjustment -If the home you are buying has oil heating or has a propane fireplace you will be required to pay the owner for a full tank of fuel on closing. The owner will fill the tank(s) the day before closing. You will pay this at your lawyer’s office on the closing date. The cost for this will vary. As of Jan. 2008 a full tank of oil would be about $900 and a full tank of propane is about $400.

Fire/Homeowner’s Insurance– You will be required to have fire insurance on your home on the day of closing. The mortgage company requires the lawyer to have proof of this on closing. This can often be arranged in monthly or other installments. $700-$900

Water quality and quantity tests
– If the property you are buying is on a well the mortgage company will require that you obtain a water test for quality. The water is tested for bacteria, arsenic and uranium. The cost to have this test completed if you do it yourself, which is the most common, is about $100. You should also consider having a ” Flow Rate” test completed also. This test will determine the amount of water the well is currently producing. The cost to have a professional do this is between $200 and $400. This is an optional test but one I would strongly recommend.

Septic field test
– If the property you are buying has a septic field is it advisable to have it tested for leaks etc. This costs about $300 to complete.

New Appliances, curtains etc..- You will need appliances for your new home as well as curtains and other necessary items. Allow enough for these items in your closing cost calculations.

Posted under Closing

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