Additional feesOkay! Your mortgage choice is finally done. All that remains is eagerly waiting for moving day. But while waiting, here is a short list of expenses that you can expect when taking possession of your new home. Count on 3% to 4% of the purchase price for these costs: Mortgage insurance premium (example SCHL/CANADA GUARANTY)According to the National Housing Act, if your downpayment is lower than 20% of the purchase price, your mortgage must be covered by an insurance against payment default. These fees, which can vary between 0.60% and 4.50%1, can be added to the mortgage amount or be paid entirely when closing the loan. Note that it will also be necessary to add the 9% tax required on the mortgage insurance premium. Unfortunately this one cannot be added to the mortgage and must be paid in cash at the closing transaction with the notary.Home insuranceIn order to guarantee their loan, all financial institutions require that your home be insured for fire at the closing with the notary. Without this insurance coverage, there is no purchase. We suggest you consult an insurance broker for the best premium.Evaluation feeTo determine the market value of your future property, the lending institution usually requires an evaluation be done by an expert. This ensures that the amount of the loan is realistic. This expense is generally covered by the lender. However, sometimes the purchaser must defray this cost, especially if it is a non-standard loan.Legal feesOf course, your new purchase must be immortalised on paper. This is why the services of a notary are essential. The notary will write up and register the sales and mortgage contracts. Then you will be able to sleep at night!
Your bank will probably require a new certificate of location for the property you wish to purchase, especially if no certificate were produced since the cadastral reform of the territory of Quebec. This official and legal document must be prepared by a land surveyor. Generally, these expenses are the responsibility of the seller. In addition, there is a special clause in the offer to purchase written by the OACIQ and used by certified real estate mortgage brokers.
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