Save for your down payment
& other upfront costs
If you are thinking of becoming a homeowner, you will need to start saving up for this very important purchase. You will need to consider the following costs:
To buy a home, you will need a minimum down payment of 5%.
Mortgage Default Insurance is a legal requirement with a down payment less than 20% and your financial institution will arrange this insurance for you. You can pay it up-front or add it to your mortgage. Mortgage default insurance will cost between 2.8% and 4.0% of your total mortgage, depending on the size of your down payment.
Expect to pay approximately 1.5% - 2% of the home’s purchase price in closing costs, which include legal fees and land transfer fees. You must pay these costs when you take possession of the house.
Getting a home inspection before putting an offer on a home is a good idea. A home inspection can cost $275 - $500+, depending on the size of the home.
The financial institution may require an independent appraisal of the home. If an appraisal is necessary, it typically costs around $300.
Don’t forget about moving costs as they can add up quickly if you’re hiring professional movers.