What are the closing costs when buying a home in Ontario?
Revealed: What you’ll actually pay in closing costs when buying a home in Ontario — and what it costs in Georgetown, ON
Why this matters now
Buying a home is a numbers game. The advertised price is only the start. Closing costs add up fast and catch unprepared buyers and sellers off guard. If you’re moving to or selling in Georgetown, Ontario, know these costs today so you can negotiate, budget, and win.
Below is a direct, practical breakdown of every common closing cost for buyers and sellers in Ontario — with clear notes on how they specifically hit Georgetown residents.
Quick summary: Who pays what
- Buyer pays: land transfer tax (Ontario), legal fees & disbursements, title insurance, home inspection, appraisal (if lender requires), mortgage default insurance (if applicable), adjustments (property tax, utilities), property insurance, and other move-in costs.
- Seller pays: real estate commissions, seller legal fees, mortgage discharge penalty (if any), closing adjustments, and pre-listing repairs or staging.
Now the details.
The biggest surprise: Ontario Land Transfer Tax (LTT)
This is the single largest mandatory closing cost for buyers in Ontario. It’s a provincial tax calculated on a sliding scale based on the purchase price.
- Why it matters in Georgetown: Georgetown buyers pay the same Ontario LTT as the rest of the province. Georgetown does not add a municipal land transfer tax like Toronto does.
- First-time buyers: eligible for an Ontario rebate up to $4,000 (check current rules with your lawyer).
Example (rounded):
- $400,000 home → LTT roughly $3,475
- $800,000 home → LTT roughly $11,475
These numbers are examples. Use a precise LTT calculator or ask your lawyer for exact figures.
Realtor commission — who actually pays it?
Realtor commission is almost always paid by the seller from sale proceeds. Typical rates in the GTA area hover around 4-6% of sale price, split between buyer and seller agents. That’s why sellers need to net a number that covers that commission.
- Impact on Georgetown sellers: commission eats into your net proceeds. If you want a strong sale price, factor commission into your asking price and negotiation strategy.
Legal fees and disbursements
Every transaction requires a lawyer or licensed conveyancer. They handle title searches, registering documents, transferring funds, and providing closing statements.
- Typical range: $800–$2,000 for straightforward residential deals.
- Disbursements: registration fees, courier, title search. Expect $200–$500 extra.
- HST applies to legal services.
For sellers: your lawyer will also prepare the deed, pay out your mortgage, and handle adjustments.
Title insurance
Lenders often require title insurance when financing a purchase. Many buyers buy title insurance to protect against historical title issues.
- Cost: usually $200–$400 one-time.
- Impact: small but important safety net. In Georgetown older homes can have quirks — title insurance is worth it.
Mortgage default insurance (CMHC or others)
If your down payment is less than 20%, you’ll pay mortgage loan insurance. This protects the lender and can be added to your mortgage or paid upfront.
- Cost: depends on down payment percentage. For example, a 5% down payment on a high-ratio mortgage can translate to a 2.8–4% premium on the mortgage amount.
- Georgetown impact: affordability pressure in the Halton Hills market may push buyers to smaller down payments. Factor mortgage insurance into your monthly payment forecast.
Appraisal, home inspection, and surveys
- Home inspection: recommended for buyers. Cost: $400–$700.
- Appraisal: lender may require it. Cost: $300–$600.
- Survey or real property report: sometimes requested. Cost varies widely.
These are small compared to LTT and commissions but matter for decision-making and mortgage approval.
Adjustments at closing: taxes, utilities, and condo fees
Adjustments compensate the buyer or seller for amounts paid in advance or owed.
- Property taxes: if seller already paid yearly taxes, buyer reimburses their share after closing.
- Utilities: similar adjustments if paid in advance.
- Condo fees: seller typically pays until closing; buyer pays after.
For Georgetown sellers and buyers: know the tax cycle in Halton Region — a few hundred to a few thousand dollars can change hands depending on closing date.
HST — when does it apply?
- Resale homes: the sale price is generally HST-exempt. HST does not apply to residential resale purchases.
- New homes and substantial renovations: HST applies. Rebates or partial rebates may be available.
- HST applies to many services: legal fees, realtor commission, and sometimes home inspection or repairs.
If you’re buying a new build in or near Georgetown, factor HST into the closing costs.
Mortgage-related closing costs
- Mortgage administration or appraisal fees: $200–$500.
- Interest adjustment: you’ll owe interest from closing date until the first mortgage payment date.
- Mortgage discharge fee (for sellers): lenders charge to close the mortgage — often $200–$400. Penalties may apply for prepayment.
Common seller closing costs in Georgetown
- Realtor commission (largest cost)
- Legal fees & disbursements
- Mortgage discharge fees or prepayment penalties
- Repair credits negotiated at closing
- Closing adjustments owed to buyer
- Moving and staging costs
Sellers should run a seller net sheet before listing to avoid surprises. Buyers should run a buy-side closing budget.
How much cash do buyers actually need on closing day?
Buyers should expect to bring these funds to closing:
- Balance of down payment (purchase price minus deposit)
- Land transfer tax
- Legal fees and disbursements
- Title insurance (if not included elsewhere)
- Adjustments and any other negotiated credits
Example checklist for closing a $700,000 home in Georgetown (illustrative only):
- Down payment balance (assume 10% total down with 5% deposit already paid): $35,000
- LTT: approx. $8,475
- Legal fees + disbursements: $1,500
- Title insurance: $300
- Adjustments: $1,200
- Misc (inspection, appraisal paid earlier): $1,000
Total cash to close: roughly $47,475
This example shows LTT and down payment dominate the cash required.
Negotiation levers and planning tips (use these now)
- Ask for an LTT estimate before you make an offer. It influences the true cost.
- First-time buyer rebate? Claim it through your lawyer to reduce your LTT.
- If you’re selling and buying simultaneously, coordinate closings to minimize bridging costs.
- Shop legal and title insurance quotes. Small savings multiply on multiple transactions.
- If down payment is under 20%, calculate mortgage insurance into your monthly payment and total debt service ratio.
Why work with a local expert in Georgetown
Local markets matter. Georgetown and Halton Hills have unique inventory and closing timelines. A local specialist knows: property tax cycles, common title quirks, typical closing adjustments, and realistic seller net proceeds.
Tony Sousa helps buyers and sellers in Georgetown plan closing costs precisely. Reach out for a clear closing cost estimate, a seller net sheet, or a buyer closing checklist.
Contact: tony@sousasells.ca | 416-477-2620 | https://www.sousasells.ca
Final checklist before you sign
- Confirm exact LTT with your lawyer
- Get a written quote for legal fees and disbursements
- Confirm whether title insurance is required and at what cost
- Ask your lender for a written mortgage insurance and interest adjustment estimate
- Prepare moving and utility transfer budgets
Act now: closing costs move deals. Know them and you control the negotiation.
FAQ — Common questions sellers in Georgetown ask about financing, mortgages, and closing costs
Q: Who pays the buyer’s land transfer tax?
A: The buyer pays Ontario Land Transfer Tax. Georgetown has no additional municipal LTT.
Q: As a seller, what closing costs should I expect?
A: Seller costs usually include real estate commission, legal fees, mortgage discharge fees or penalties, repairs or credits negotiated at closing, and normal adjustments.
Q: Do sellers ever pay buyer closing costs?
A: Only if negotiated in the agreement of purchase and sale. Sellers sometimes provide credits for repairs or to cover certain buyer costs as part of deal terms.
Q: Is HST charged on the sale of my resale home?
A: No. HST generally does not apply to resale residential real estate. HST applies to new-build homes and many professional services like legal fees and possibly commissions.
Q: How do mortgage prepayment penalties affect my net proceeds?
A: If you have a closed mortgage and pay it off early, your lender may charge penalties. These can be significant. Ask your lender for a pay-off statement before listing.
Q: How can sellers in Georgetown reduce closing friction?
A: Get an early mortgage discharge statement, price to cover commission and closing costs, pre-inspect or repair obvious issues, and use a local lawyer who understands Halton Region adjustments.
Q: If I’m selling and buying at the same time, how do I avoid bridge financing?
A: Coordinate closing dates, negotiate occupancy dates, or arrange conditional closings. Speak with your lender and lawyer early.
Q: Where can I get an accurate closing cost estimate for my specific Georgetown property?
A: Contact a local real estate professional and a licensed conveyancer or lawyer. For direct help, contact Tony Sousa at tony@sousasells.ca or call 416-477-2620.
