Whether buying or selling a home, you will have to budget for Regina Real Estate Fees. These fees range from mortgage penalties to home inspections, taxes, and title disbursement fees. Fees vary depending on the situation of the buyer or seller and they also vary depending on which vendor is being used. The price of home insurance or title insurance varies, depending on the provider and the exact product. Let me break these costs down for you.
Regina Real Estate Fees for BUYERS
Home Inspection $400-$600
A Home Inspection is not mandatory to purchase a home. Home Inspections are encouraged because they are the best way for the buyer to discover everything about the property before they agree to purchase. Home Inspections are the buyers own due diligence to themselves. The average home inspection costs between $400.00-$600.00. If other inspections such as sewer or foundation inspections are included, the cost could be more.
Legal Fees $2000-$2300
When you purchase a home, you will need to hire a lawyer. Included in your legal fees is the cost of the lawyer, registration of the mortgage, disbursements and GST/PST. This cost is based on the purchase price of approx. $300,000. The higher the cost of the house, the higher the legal fees.
Lender Title Insurance $150-$200
Title insurance protects both lenders and property owners from errors, omissions or defects in the title of a property, as well as title-related fraud or forgery. Depending on the Lender, this insurance may be required and costs around $150-$200.00. The cost is dependent on the lawyer.
CMHC Insurance Tax (6% PST) $560
Mid 2017, it was announced that buyers would have to pay PST on the CMHC insurance premium. Let’s say you have a purchase price of $260,000 and put 5% down. The new mortgage is $247,000 + 4% CMHC Insurance. The NEW MORTAGE is $256,880.
You paid $9,880 in CMHC insurance which is simply added to the balance of your mortgage but now you have to pay PST on this $9,880. The tax equals an additional $592.80 that will be due at the lawyer’s office upon closing.
Tax Adjustments
If the sellers paid the taxes for the entire year and you buy the home in September, you will have to ‘back pay’ the sellers for the three months they paid in advance. This becomes an issue when the seller has paid taxes for the entire year and the buyer takes possession at the beginning of the year because depending on the taxes, it can be a large amount for the buyer’s to back pay.
If the seller hasn’t paid taxes for the year or is behind on a TIPPS payment, the buyer will be credited the amount the seller owes. Unfortunately, the tax adjustment is not a cost that can be predicted prior to the purchase but it doesn't hurt to ask the sellers what the property tax situation is. This is a cost that is addressed and adjusted at the lawyer’s office.
Appraisal Fees $200-$300
An Appraisal is normally requested during the financing process. Appraisals are requested because the lender or bank wants to verify the value of the home. The bank or lender needs to make sure they are not ensuring a mortgage for more than the home is worth. They are trying to protect themselves in the event you default on the mortgage and they need to sell it to recoup what is still owed. Appraisals usually only happen on MLS homes where 20% or more is put down.
An appraisal costs between $200.00-$300.00 for a property in the city. Rural appraisals will cost closer to $500.00.
Service Fees $150
If you have never used SaskPower, SaskEnergy, SaskTel or City of Regina Water then upon connection of these services you could be charged a connection fee. These are minor costs and shouldn’t exceed $150.00
Home Insurance
Before the buyer takes possession of their new home, proof of home insurance must be provided to the lawyers. Home insurance can be provided by SGI, Knight Archer, Harvard Western and many other insurance companies. The total cost of home insurance could be between $1500-$3000 depending on the home but all insurance companies offer monthly or bi-weekly payment plans.
Real Estate Agent $0
Real Estate Agents are free for buyers to use. There is no cost to the buyer to hire a real estate agent.
Mortgage Associate/Broker $0
Mortgage Brokers or Associates are free for buyers to use. There is no cost to the buyer to hire a mortgage broker or associate.
Regina Real Estate Fees for SELLERS
Mortgage Penalty Fees
Sellers are charged mortgage penalties for breaking the terms of a mortgage early, depending on the type of mortgage. Approximately 70% of people break the terms of their mortgage early. The Interest Rate Differential is a compensation charge that may apply if you pay off your mortgage prior to the maturity date. Most closed fixed-rate mortgages have a prepayment penalty that is the higher of 3-months interest or the IRD. Most variable-rate mortgages do not have IRD penalties. Mortgage penalties vary depending on the bank and the mortgage so I cannot provide estimates for this fee. The penalty could range between $1500-$20,000. The best way to know your exact penalty would be to call your bank or mortgage broker.
Title Disbursement Fees $1200
Selling a home also requires a lawyer. The seller’s lawyer is responsible for dispersing the existing mortgage, reviewing purchase and sale documents, paying the balance of real estate commissions or taxes and making utility adjustments. The cost for a seller’s legal fees vary depending on the home but are usually under $1200.00.
Pre Listing Home inspection $400-$600
A pre-listing home inspection is recommended for seller’s who want to combat any potential problems a buyer could find. A pre-listing home inspection would be used to discover any defects and list the home accordingly or allows the seller fix a few items before the home goes on the market. A pre-listing home inspection can cost between $400-$600.
Appraisal Fees $200-$300
A seller may opt to have an Appraisal performed instead of a Comparative Market Analysis. If a seller is unsure of the real estate agents suggested price for the home, a good alternative is to get an Appraisal and compare the numbers. A home appraisal will cost between $200-$300.
Real Estate Agent Fee’s
There is no ‘average’ commission. Agents charge anywhere between 2-8% of the purchase price and this cost should also include the buyer’s agent fee. The commission is negotiable and there is no ‘set’ rate. Feel free to ask the Realtor® if the commission can be negotiated and why he/she charges that amount.
Regina Real Estate Fees VARY DEPENDING ON WHO IS PROVIDING THE SERVICE.
Before you take my word on these costs, I encourage you to call 2-3 different service providers and obtain your quotes based on your own situation and needs. Every lawyer, home inspector, appraiser and Realtor® has a different fee. I have provided you estimates of these costs for personal information and awareness only. You should also consider the costs of movers, or the costs of buying new furniture or household maintenance items like lawn mowers and snow blowers. These costs are related to standard fees associated with most purchase and sales.
There are many MLS Homes that require new shingles or windows and those costs have not been considered in this article. I encourage you to be aware of these additional costs when looking for a new home and don't be afraid to get a few quotes during the 'Conditional Offer' process so you can budget in advance.
If you have questions or would like more information on these Regina Real Estate Fees please call at 306-552-7047 or fill out my contact form!
Kelsey Smith Is Regina’s Choice
Choosing the right Realtor® is key to ensure a positive and successful real estate transaction. Kelsey Smith promises to deliver the education and time necessary to buy or sell your Regina home. Call 1-306-552-7047 and rest easy knowing you have made the right choice.