It can be confusing if you are a first time home buyer. What kind of costs will you be facing down the road when you are closing the sale of your home? There are so many fees, expenses and taxes that you will have to pay. It can become scary and frustrating. Below is the list of general costs when you are closing your deal.

You can expect the budget to be about 2% of the purchase price of the home in the closing costs. So if you are buying a $200,000 home you will be paying around $4,000 for the closing costs. This is a general outline. You have to ask the people involved with the deal to get a better idea of what the costs will add up to in the long run.

-Home Inspection: A qualified inspector can access your property and find any defects as well as give you information on your home. This will cost between $250- $350.

-Appraisal: The lender arranges for an appraiser that will give their professional opinion on current market values for your home. This can cost from between $100-$300.

-Legal Fees: For this your lawyer can handle all the paperwork for the purchase of your home. You will have to apply for the legal fees in the closing of your home and mortgage and any additional disbursement fees that will cover things like the courier costs, photocopies, faxes, supplies and other registrations. You must remember to ask for a quote. This will cover the disbursement fees and you won’t be caught and shocked later. The fees will vary but usually they will be around $1,000-$1,300 factoring in the lawyer and life events.

-Land Survey Title Insurance: The seller will probably give you the survey of the home. However, if not you can get a replacement for around $600-$900. There are also many lenders that will accept title insurance and that will only cost you a few hundred dollars which will save you money. Make sure you talk to your lender and see what can be worked out.

-Fire Insurance: You have to have and maintain fire and extended coverage insurance. This will continue for the length of the mortgage or for the replacement value of the building. The cost can vary and depends on the home, the amount of coverage and the insurance company you are dealing with. It will also depend on the city. However, you will probably pay anywhere from $250-$600 a year.

-Ontario Land Transfer Tax: You can find this on line and learn how to calculate them as far as your purchase.

-Interest Adjustment: Mortgage payments are due the first day of the month. However, if your closing date doesn’t fall on that day then you have to prepay the amount of interest accruing to the first of the next month. This is called the interest adjustment date. This period could be shorter if you have a bi-weekly or weekly payment.

-Mortgage Insurance and PST: The insurance premium is added to the mortgage so you don’t pay in cash on the closing date. You still have to pay the PST of 8% on closing.

-Closing Adjustments: This will cover the utilities that the seller prepaid and will get from you.

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