Genesis Associates Mortgage Brokers on Purchase Tips (866) 410.4410

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Genesis Associates Mortgage Brokers on Purchase Tips

Costs associated with the purchase of a home include:

Appraisal fees

Cost to obtain a survey

Land transfer taxes (First Time Buyers get a break!! Contact us.)

CMHC / GENWORTH mortgage insurance (if applicable)

Moving expenses

Legal fees

Home Insurance

Property Tax Adjustment

Fuel Adjustment

You may wish to Contact us to provide you with estimates of some of these costs. We will be able to give you a reasonable estimate based on your situation. A lawyer should be consulted before you sign any binding documents or make any formal commitments. If you do not have a lawyer, contact us and we will refer you to one for a free initial consultation.

Ongoing housing costs include:

Property taxes

Mortgage life insurance (if applicable)

Heating costs

Condominium fees (if applicable)

Operating and maintenance costs

Monthly mortgage payments

How can I save money on my mortgage? - The easiest way to reduce the interest costs on a mortgage is to pay it off sooner. Here are four ways this can be done:

Increase Payment Contact us about how paying weekly or bi-weekly, rather than monthly, can save a significant amount of interest.

Prepay Some institutions offer up to 20-25% of the original principal amount of your mortgage anytime during each year of the term of the mortgage, without penalty or administration fee. Contact us for more info

Increase or Lump Sum Payments - Once each year during the term, institutions offer mortgage payments that may be increased by up to 15-20% of the payment originally established for the term of the mortgage without penalty or administration fee. Contact us for more info.

Amortization Period Simply defined this period of time measured in years is the maximum length of time it would take to completely pay off a mortgage. By reducing the amortization the mortgage payments will increase, however, the total interest paid against the mortgage will decrease. Contact us for a direct comparison.

Other Costs to be Aware of When You Buy - This is a list of possible extra costs involved in buying a home. Some of them are one-time costs and others, such as condominium maintenance fees and property insurance, will be ongoing monthly expenses. The good news is that not all of these costs may apply in your circumstances.

The 7% GST applies to new housing. However, there is a rebate, to a maximum of 2.5%, if your home costs less than $450,000. There is no GST on resale housing unless the home has been substantially renovated, and then the tax is applied as if it were a new home. In some provinces, the GST has been replaced by a Harmonized Federal and Provincial Sales Tax known as the HST. Also in other provinces, provincial taxes may be applicable.

Appraisal fee: If your loan is not insured, your lender may require a property appraisal at your expense. A basic appraisal for mortgage purposes will probably cost between $150 - $250. Actual cost should be confirmed as it may vary with the location and complexity.

Property taxes: Taxes are always a certainty. If you have a high-ratio mortgage, your lender may require that you have your property tax installments added to your mortgage payments.

Survey fee: Your lender will require an up-to-date survey. Ask the vendor to provide one as a condition of your Offer to Purchase, or you will have to pay to have one done.

Property insurance: This insurance covers the replacement value of the structure of your home and its contents. Your lender will insist on this because your home is the security for your mortgage.

Prepaid taxes or utility bills: You will have to reimburse the vendor on a prorated basis if some bills have been prepaid beyond the closing date.

Land transfer tax: This applies in most provinces. It varies as a percentage of the property's purchase price. It is usually about 1% 4%.

Service charges: You'll be charged a fee to hook up new services and utilities, such as your telephone, at your new home.

Lawyer (notary) fees: Even a straightforward home purchase requires a lawyer to review the Offer to Purchase, search the title, draw up mortgage documents and tend to the closing details. Lawyer's fees for a mortgage range widely depending on the complexity of the deal but will probably be at least $500.

Mortgage loan insurance premium and application fee: If you have a high-ratio mortgage, your lender will require mortgage loan insurance provided by CMHC or a private company. The insurance will cost between 0.5% and 3.25% of the amount of the total mortgage (additional charges may apply) and can be included in the mortgage. The application fee will range from $75 to $235 depending upon how the lender processes your application.(consult your local lender for further details)

Homeowner mortgage loan insurance premiums vary according to loan-to-value ratio. Effective July 14, 2003

Loan Amount as                                                                 Premium on Increase
a % of the Value                      Purchase Premium           to Loan Amount for
of the Home (LTV)                   on Total Loan                   Portability and Refinance *

Up to and including 65% 0.50% 0.50%

Up to and including 75% 0.65% 2.25%

Up to and including 80% 1.00% 2.75%

Up to and including 85% 1.75% 3.50%

Up to and including 90% 2.00% 4.25%

Up to and including 95% 3.25%

Premium Surcharges apply on the following:

Progress Advance: 0.50%

Standard Variable Rate Mortgages (VRM's): 0.25%

Blended Amortization for Refinance and Portability: 0.50%

Secured Line of Credit:
Non-Amortizing Repayment Option: 5 years (5/20) 0.25% 10 years (10/15) 0.50%

* For Portability and Refinance, the premium is the lesser of the premium on the increase to the loan amount or, the Purchase premium on the total loan. In the case of Portability, a premium credit may be available under certain conditions to reduce the Purchase premium. Note: Contact us for premium surcharges and other terms and conditions which continue to apply. You can pay this premium in a single lump sum (saving interest on this charge), or add it to your mortgage and include it in your

Mortgage broker's fee: A broker may charge a fee to find you a lender*.

Moving costs: Don't forget the cost of a professional moving company or a rental truck if you move yourself. Fees for a professional mover can range from $50 $100 an hour for a van and three movers. These costs may be 10% 20% higher at the end of the month and in the summer.

Estoppel or Status Certificate: A certificate that outlines a condominium corporation's financial and legal state. The certificate and supporting documents will cost you up to $50. (Does not apply in Quebec.)

Condominium fees: Condominiums charge monthly fees for common-area maintenance, such as groundskeeping and carpet cleaning. Fees range widely depending on the type of structure but will probably be at least a few hundred dollars per month.

Home inspection fee: Inspectors are unregulated in many provinces, so fees range widely, from about $150 $350 for a home priced under $300,000. Larger, more expensive homes cost more to inspect. A two-hour inspection carried out by an engineer who provides a written report will cost closer to the upper limit. Municipalities can also supply any available inspection reports on the property for a fee.

Renovation and repairs: A home inspection may indicate that the home needs major structural repairs such as a new roof. Don't forget to factor these costs into the price of the home.

Water quantity and quality certification: If you're buying a home with well service, you'll have to pay a fee from $50-$100 to certify the quantity and quality of the water.