The hidden costs of selling a home in Canada
If you are selling your home there are several hidden costs that you may not be aware of. These costs can take away from the amount you are hoping to earn or put down on a next house. By being aware of these fees and budgeting carefully, you will get the most from the sale of your home.
When a home is sold by a real estate agent, that person or group receives a percentage of the sale. Most agents charge around 6% of the sale price, plus tax (depending on the rate in your province). This money comes out of the funds you receive. For example, if your home sells for $150,000 you will have to pay the agent around $9,000, plus tax.
If your home is empty, or if you are selling a home of an elderly relative, having it staged could mean the sale of the home. A staged home is more attractive to buyers because it gives them a lived-in feel. Staging a home can cost several hundred dollars but is normally money well spent.
Your mortgage may have you locked in for a certain amount of years. If you pay it off early, or remortgage with another bank, you will need to pay a penalty. The penalty is normally calculated based on the amount owed and the amount of days remaining on the loan. If you don't have the capital to pay for it, you could get a fast personal loan from 24Cash.ca. This will give you some quick cash that can be paid back later. It is wise to call your bank and inquire how much it will cost to pay off or end your mortgage agreement. If you are buying another home right away, you many ask your bank to waive the penalty if you take your new mortgage with the same lender. If not, shop around for a bank or mortgage broker with flexible options for prepayment and other possible situations.
Before putting your home on the market, you may be required to fix any major repairs. For example, if your roof is leaking, you will need to replace it. Many buyers will not be interested in a home that needs a lot of work. If major problems are discovered after the sale of your home, you could be responsible for paying a professional to have them repaired. On the other hand, if you sell your home‘as is’, you can disclose any problems you know of and avoid any repair costs. However, a home sold without a legal warranty will lower the total cost and value of the home. The buyer acknowledges that there is no guarantee and assumes the potential problems with the home. The seller typically gets less money for the home, but is not legally responsible in the case of repairs found in the future.
Before you can sell a home it will need to be professionally measured. This will give the true square footage of the home, and property, which is required by many mortgage companies. If the property has not been surveyed in a long time, it may be required to have the transaction notarized. A detailed document is prepared, and the sooner it`s up to date, the easier it will be for potential buyers to proceed with their request for a mortgage. A professional property survey can set you back almost several hundred to a thousand dollars, depending on the size of your lot, etc. legal costs you will encounter when selling a home. These costs can vary, depending on where you live. Typically the seller pays for their notary of choice. Notarizing the sale of a home costs approximately $1,000.
Now that you are aware of some of the hidden costs of selling a home, you can prepare and budget for them. It’s a great idea to have a little extra money saved up to cover such expenses.