CLOSING COSTS FOR NON-CONDOMINIUM PROPERTIES

By Jayson Schwarz

At the closing of a new land titles residential real estate transaction there are usually three groups who get paid: (1) the vendor (builder), (2) various governments, and (3) the lawyer. Each group involves the payment of fairly specific items and the builder and lawyer will collect from you for the government remittance.

Generally speaking your lawyer collects all of the necessary money form your mortgage company and from you. You will need certified cheques because of his trust account requirements. First I will deal with the builder and then show where all the money your lawyer wants needs to go. The builder will get paid for the property and a list of other things. You may even get a credit in places. These other items are called adjustments. The adjustments will be reflected on a document called the Statement of Adjustments.

The Statement of Adjustments will contain a multitude of different items, all being related to your original agreement. The Statement of Adjustments will include the GST payable and the rebate will broken out, the original purchase price, real estate taxes, hydro, connection costs, levies and charges, to name but a few. This document is incredibly important. You need to review it slowly and carefully and get everything explained so you understand all the charges that are being paid. It is at this point that you find out the final number you are paying to the builder for your new home.

The Provincial government will get paid for Land Transfer Tax (unless you are entitled to the rebate) and sales tax on goods if applicable. There are many other items, but they usually show up on your lawyers disbursement account, as do the many Municipal compliance request charges.

OK, what about that lawyer. First of all you are going to pay the fee, whatever the amount the two of you agreed to. You did of course have a pre-agreed fee didn't you? If you did not and feel the fee is outrageous, watch for how to deal with this in a later Today's Tips.

Then there is a list of disbursements. Disbursements are those monies expended by your lawyer on your behalf necessary to properly search and close the transaction. Be careful, it is here that someone may try to take advantage by charging large fax, mail and photocopy fees. Make your lawyer justify all expenditures that don't make sense. What about disbursements what can you expect? All right here is a list; it is not suggested to be anything but a guideline and can vary substantially between municipalities and conveyancers:

• Tax Certificate $35
• Building Compliance $60-100
• Hydro $15
• Subdivision Compliance (if required) $60-75
• Conveyancer on search $75
• Documents at registry $15-55
• Conveyancer at closing $75
• Executions $11/name - depends on how many searched
• Register Deed $50
• Register Mortgage $50
• Law Society Levy $50
• Plus GST

There you have it, an overview of what you can look forward to, but remember a large part of this is based on what you negotiate at the beginning and is in you Agreement of Purchase and Sale. Please remember to send in questions via fax to (416) 486-3325 and I will try to answer them for you either on the net or in print.