Tag Archives: Ontario Land Transfer Tax

What to expect at closing

15 Thursday Feb 2018

Posted by in Buying a Home, Mortgage

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You have met with your mortgage broker and have met all the conditions to secure financing.  Next step is to meet with your lawyer.  A referral is always a good way to go in finding a lawyer.  When you have found one or a few, feel free to give them a call to see how much they will charge you.  Fees can vary.  You do not have to wait until closing day to meet with your lawyer; you can do so days ahead and this gives you more time on move day as well as peace of mind.

Here is a basic idea of the items that will be reviewed at your lawyers.

Down Payment:  in setting up your financing you agreed to a certain amount as a down payment.  The amount that you put down as a deposit with your Purchase Offer will be factored as part of your down payment money.  The total amount of down payment will be purchase price minus mortgage amount minus deposits.  You lawyer will finalize this number for you which you will bring as certified funds.  If you are selling a home and purchasing another one, then whatever equity is coming from that property will form part of the down payment.  The total amount of the down payment will be purchase price minus mortgage amount, minus existing equity, minus deposits.

Land Transfer Tax: this tax is calculated as a percentage of the purchase price of your home, which is payable upon closing.  The amount varies in different provinces but you lawyer will be able to determine what the amount is for you.  If you are a first time home buyer you may receive rebates on Land Transfer Tax so decreasing the amount you owe.

PST on Insured Mortgages:  When you put less than 20% down on the purchase of a home, it will be insured by one of the three companies that insure mortgages in Canada.  This mortgage insurance premium which most commonly is added to the mortgage, is charged a PST tax which you will be required to pay at closing.

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First Time Home Buyer? Here are a few incentives…..

29 Friday May 2015

Posted by in Buying a Home

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RRSP WITHDRAWAL AS A DOWNPAYMENT

The Home Buyers’ Plan (HBP) is a government of Canada plan that allows first-time home buyers to withdraw up to $25,000 PER BUYER, from an RRSP to buy or build a home without having to pay tax on the withdrawal.  Generally you have 15 years to pay back your withdrawal and your repayment period starts 2 years after the withdrawal. However you are free to pay the full amount at any time before the 15 year time frame. If you are buying or helping to buy or build a home for someone related to you with a disability, you too may take advantage of the Home Buyers Plan.

See here for more information:       http://www.cra-arc.gc.ca/hbp/

First-Time Home buyers’ Tax Credit: $750.00

First-Time Home Buyers’ Tax Credit (HBTC) is to assist first-time home buyers with the costs associated with the purchase of a home, such as legal fees, disbursements and land transfer taxes. The HBTC amount will apply to qualifying homes purchased after January 27, 2009, and will provide up to $750 in a Tax Credit.  First time home buyers purchasing a home may claim the HBTC on their income tax returns.  If you like to check out more:

http://www.cra-arc.gc.ca/hbtc/

Ontario Land Transfer Tax: $4,000

Ontario’s Land Transfer Tax is a provincial tax payable by the purchaser of a property. Therefore, if you purchase a property or land, you are responsible for paying Land Transfer Tax to the Province at the time the transaction closes. First time home buyers receive a reduction of up to $4,000.00 on Ontario Land Transfer Tax.

http://www.fin.gov.on.ca/en/bulletins/ltt/1_2008.html