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Offices - Purchase of a Home Brochure
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Buying a Home
When buying a home, a major concern is always the final
cost. As well as the purchase price, the cost of your home will include legal fees and various disbursements known as
closing costs that are paid by my office on your behalf. These costs will be included in your down payment which we will require from you before possession date. GST is payable on most closing costs. RST is payable on Legal Fees. Typical Closing Costs
Legal Fees:
The Manitoba Bar Association provides a suggested set of
legal fees for house sale transactions. The fees that will be
charged are dependent upon such factors as the complexity of the transaction, whether there is a rush to process the documents, the seasonal delays, etc.
Our flat-rate for a basic residential home purchase transaction is $675.00 plus GST & RST.
Land Transfer Tax:
This tax is calculated as a percentage of the purchase price, and is payable to the Land Titles Office at the time the title is registered. Please see the included schedule for the fees that will apply to your purchase.
Registration Costs:
These are also paid to the Land Titles Office at the time of
registration. The cost of registering a title is $85.00 and the cost of registering a mortgage, if required is also $85.00. Survey Certificate/Title Insurance:
If a survey certificate is not available from the seller, a new survey is required. The cost is approximately $550.00. Title Insurance can be purchased as an alternative to buying a new survey at a cost of $200.00 to $250.00. If Title Insurance is purchased, in most cases you will not have to pay interest to the Vendor as mortgage funds can be advanced more quickly. Zoning Memorandum:
This document verifies that the property complies with
municipal zoning regulation. The cost is $70.00.
Tax/Title Searches:
This refers to searching the title and ordering copies of any encumbrances registered against it. The cost is $20.00 per tax search and $30.00 per title search.
Tax Certificate:
This document verifies whether or not there are any unpaid
property taxes. The cost is $43.00.
Miscellaneous Disbursements:
The cost for couriers, photocopies, faxes, postage, file
management, file storage, office supplies, and accounting fees are approximately $200.00.
Interest:
The question of interest often arises when there is a delay in the processing of mortgage documents at the Land Titles Office. If you are arranging a new mortgage, the mortgage money will not be released until the registration and lawyer's summary are complete. There will be no interest charged during the period, as you have not yet received the mortgage money.
However, it is standard practice for the home-buyer to pay
interest to the seller on the unpaid purchase price at the
mortgage rate of interest, from possession date until final
payment is made. Title Insurance may eliminate this cost.
Property Taxes:
You are responsible for the property taxes for the months that you own the house. In all transactions, either the buyer or the seller pays the annual tax bill. The party who paid the taxes is then reimbursed by the other party by way of an adjustment to the sale price.
If the purchase is made before the taxes are due, you pay the property taxes, but will be given a credit from the seller for his portion, and if the taxes are already paid, you will reimburse the seller for your share.
Please note: Fees are subject to change without notice. The general information in this brochure and examples are for the purpose of illustration only. Various other factors may come into play and affect the costs of any individual home purchase. Please contact my office for details regarding your home purchase.
Example of a Purchase:
Information:
Possession Date June 1
Purchase Price $200,000.00
Mortgage (10% down) $180,000.00
Interest Rate 4%
Property Taxes $2,400.00
Land Titles Delays 21 days
Closing Costs:
Disbursements:
Land Transfer Tax $ 1,735.00
Mtg. Registration Costs 85.00
Title Insurance 250.00
Tax Certificate 43.00
Tax & Title Search 50.00
Miscellaneous 200.00
GST on $(200) 10.00
Total Disbursements $ 2,373.00
Legal Fees:
Basic Fee $ 675.00
Mortgage Fee 200.00
GST & RST on $(875) 113.75
Total Legal $ 988.75
Interest:
$180,000.00 x 4% / 365 x 30 days) $ 591.78
Total Costs:
($2,373.00 + 988.75 + 591.78) $ 3,953.53
Less:
Property Taxes Credit:
($2,400.00 รท 12 x 5) $ 1,000.00
Total Funds Required: $ 2,953.53