Mortgage closing costs are a major factor to consider when buying a home in Canada. Closing costs can add up to thousands of dollars, making them a significant expense for homebuyers. While some of these costs are unavoidable, there are certain steps you can take to reduce the amount of money you need to pay when closing on your mortgage.
- Shop Around For a Lender
Different lenders offer different mortgage terms and conditions, and these can impact your closing costs. Shopping around for a lender with the best rates and lowest fees is a great way to reduce your total closing costs. Consider researching various lenders and comparing their rates, fees and other services before making a final decision.
- Negotiate With Your Lender
After you’ve chosen a lender, consider negotiating with them to reduce your closing costs. For example, you may be able to negotiate a lower interest rate or waive some of the fees associated with closing on the mortgage. Be sure to ask your lender if they’re willing to negotiate and what terms they’re willing to offer.
- Take Advantage of Government Programs
The Canadian government offers programs to help homebuyers with the costs of purchasing a home. These programs may include grants and other financial assistance to help reduce your closing costs. Be sure to research available programs to determine if you qualify for any financial assistance.
- Consider a Higher Down Payment
Making a higher down payment on your mortgage can help reduce your closing costs. The higher down payment will decrease the amount of money you need to borrow from the lender, which can result in lower closing costs. Consider making a larger down payment if you can afford it.
- Avoid Unnecessary Fees
Closing costs can include a variety of fees, some of which may be unnecessary. For example, you may be able to avoid paying an appraisal fee or survey fee if you have a recent appraisal or survey of the property. Be sure to review all of the fees associated with closing on your mortgage to determine if any are unnecessary.
By following these tips, you can reduce the amount of money you need to pay in closing costs when purchasing a home in Canada. Be sure to research your options, negotiate with your lender and take advantage of available government programs to get the best deal on your mortgage.