Many people wonder about how much mortgage closing costs are when purchasing or refinancing a home. To make things simple, I will be providing a general overview of how much it will cost you to close on your new mortgage.
The mortgage closing costs for purchasing a property vary depending on whether you are buying, refinancing, or renewing your mortgage.
This is the easiest of the scenarios to provide an answer for, so I will start here. If you are currently with another financial institution and are looking to get a better rate, and you do not wish to borrow more money, then the process is an inexpensive one. I have several mortgage lenders available to me that have a special program available that will cover all the costs of moving from your current financial institution to a new one.
Refinancing is usually a term to describe remortgaging your property before the current mortgage’s maturity date is due, or asking for a mortgage for a larger loan amount than your current mortgage has, or increasing the amortization schedule. This also applies to ALL mortgages that are being moved from most Credit Unions, or are being moved to most Credit Unions.
In this situation, the new mortgage lender may require an appraisal to be done on your property to confirm the value of the property. Appraisals usually cost between $250-$300.
Additionally, the other charge that you will have to pay is solicitor’s fees. The solicitor will receive the mortgage instructions and do all the background work necessary to complete your mortgage. Solicitors fees vary, but you can expect the total fees including disbursements to cost anywhere from $1200-$2000, depending on the type of mortgage and the amount of work that needs to be done to complete the mortgage.
When purchasing a home, the costs are similar to the costs for a refinance, with the possibility of appraisal costs and the requirement of a solicitor. In addition, you will likely want to have an inspection done on the property that would give you detail on the condition of the property. It is highly recommended and could save you from buying a “lemon” (ie grow ops, damaged foundation, leaky homes).
Additionally, there is another cost when purchasing a property in BC called the BC Property Transfer Tax . The BC Property Transfer Tax rate is 1% of the first $200,000 and 2% of every dollar above the first $200,000.
For example, a house costing $500,000, the BC Property Transfer Tax would be:
(1% x $200,000) + ( 2% x $300,000)
This is most likely going to always be your most expensive closing cost when buying a home. The good news for first time homebuyers is that there is an exemption from the BC property Transfer Tax available up to a purchase price of $475,000. Visit my First Time Homebuyers Program page for more information.
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5 out of 5 stars
Jeff was amazing in supporting me all the way with patience, diligence, knowledge and availability. Being a dinosaur (old) I needed a lot of hand-holding and support. Time was of the very essence, and Jeff was willing to work over the weekend, which was the reason why I found Jeff in the first place. With Jeff's help, I got the best affordable mortgage and enjoy now a comfortable home with two great roof decks. Thankful Waltraud
Found Jeff on google and he is a really solid person for getting a Mortgage with. When I went through the process with him he made sure that everything was smooth and clear. He is also really responsive and takes care of the customers by offering options as opposed to ultimatums which I really like about him. Thanks for getting me my mortgage Jeff and I hope to more business with you in the future.
P.S. John Carlisle says hi as he is my lawyer or finishing the real estate purchase.
Jeff was very helpful and knowledgeable. He has helped me with two mortgage deals and both times were a good experience. Would definitely recommend Jeff.
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