The down payment is the number people save for. The closing costs are the number that has to be there on the same day, in cash, and cannot be added to the mortgage. In Toronto they can run past $30,000 on an ordinary home.
These costs fall into two groups, and the difference between them is the useful part. Some are set by published government rates and can be worked out to the dollar before you make an offer. The rest are quoted by whoever is providing the service, vary widely, and cannot honestly be estimated by anyone who is not quoting you. We do not publish figures for the second group, for the same reason we leave an unpublished bank fee blank rather than calling it zero.
The Costs That Come From Published Rates
Land Transfer Tax, Which Is Not the Same Tax Twice
This is the largest closing cost in most of the country and the one that varies most. It is charged on the purchase price, in bands, and it is due in cash on closing. Lenders do not finance it.
- Ontario charges a provincial land transfer tax, and refunds first time buyers up to $4,000, which covers the tax entirely on the first $368,000.
- Toronto charges its own municipal land transfer tax on top of the provincial one, so a Toronto buyer pays it twice. The high value bands were raised on 1 April 2026.
- British Columbia charges 1% to $200,000, 2% to $2,000,000 and 3% above that, with a further 2% on residential value above $3,000,000. First time buyer relief is full up to $835,000 and phases out entirely by $860,000.
- Quebec charges transfer duties, and Montreal adds its own bands.
- Alberta and Saskatchewan have no land transfer tax at all. They charge a title registration fee instead, which runs to hundreds of dollars rather than thousands.
The gap this creates is not marginal. On the same home, an Alberta buyer pays a registration fee in the hundreds and a Toronto buyer pays two land transfer taxes in the tens of thousands. If you are comparing cities, this belongs in the comparison well before the mortgage rate does. The land transfer tax calculator covers every province and territory plus the municipalities that charge their own, with the first time buyer rebates applied.
The Sales Tax on Mortgage Default Insurance
This is the one almost nobody budgets for, and it only exists in three provinces.
If your down payment is under 20% the mortgage carries default insurance, and the premium is normally added to the mortgage. In Ontario, Quebec and Saskatchewan, provincial sales tax is charged on that premium, and the tax itself cannot be added to the loan. It is payable in cash at closing.
| Province | Sales tax on the premium |
|---|---|
| Ontario | 8% |
| Quebec | 9% |
| Saskatchewan | 6% |
| Everywhere else | None |
A worked example, since the mechanism is easier to see than to describe. On a $600,000 home the minimum down payment is $35,000, because the tiers require 5% on the first $500,000 and 10% on the next $100,000. That leaves a $565,000 mortgage at a loan to value just above 94%, which carries the 4.00% premium: $22,600, added to the mortgage. In Ontario the 8% sales tax on that premium is $1,808, due on closing day, in cash, on top of everything else. Nothing on the mortgage approval draws attention to it.
Registration Fees
Registering the transfer and the mortgage costs a set fee in every province. In Alberta and Saskatchewan this replaces the land transfer tax rather than sitting alongside it.
The Costs Nobody Publishes
These are real, they are unavoidable, and any figure attached to them is somebody guessing. We name them so they can be budgeted for and asked about, and we do not attach numbers.
- Legal fees and disbursements. Every purchase needs a lawyer or, in BC, a notary. Fees are quoted per firm and the disbursements on top of them are a separate line.
- Title insurance. Usually required by the lender, priced on the value of the property, and usually arranged through the lawyer.
- Home inspection. Optional in the technical sense and paid before closing, so it is spent whether or not the deal completes.
- Appraisal. Sometimes required by the lender, sometimes covered by them, and worth asking about rather than assuming.
- Property tax and utility adjustments. If the seller prepaid past the closing date, you reimburse them for the part of the year you own the home. On a January closing this is small. On a closing just after a tax instalment it is not.
- Moving, and the first month of everything. Not a closing cost in the legal sense, and it lands in the same fortnight.
The One Rule Worth Carrying
Closing costs cannot be financed. That is the whole reason they deserve their own line in a savings plan rather than being treated as a detail of the mortgage. A buyer who saves exactly the minimum down payment and nothing else does not have enough money to complete the purchase, and finds that out late.
The most common way people get caught is by stretching the down payment to hit a threshold. Putting every available dollar into reaching 20% and having nothing left for the lawyer, the land transfer tax and the adjustments is worse than putting 15% down and closing comfortably, even though 20% avoids the insurance premium.
Work out the province specific figures first with the land transfer tax calculator, then check what a lender would actually approve with the affordability calculator, which applies the stress test and the debt service limits rather than assuming a multiple of income. If you are still deciding whether to buy at all, rent against buy counts these costs on both sides, which is where most of the answer lives.
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