Closing Costs in Ontario: What You’ll Really Pay on Closing Day

A Philer AI Guide to Smart Homebuying

Buying a home in Ontario is a major milestone—but many buyers focus so heavily on the down payment that they forget to plan for closing costs, which can add significantly to the final bill. These are the essential legal, administrative, and service fees that must be paid before you get the keys.

At Philer AI, Ontario’s fully digital real estate law firm, we’re committed to helping you close seamlessly—from legal review to document signing—entirely online. Here’s a clear breakdown of the most common closing costs you should be aware of.

1. Land Transfer Tax (LTT)

Land Transfer Tax is a provincial requirement for most real estate purchases in Ontario.

If you’re buying in the City of Toronto, you may also be responsible for a municipal land transfer tax.

First-time homebuyers could be eligible for rebates that reduce this cost.
Philer AI Tip: Ask your lawyer to calculate the estimated LTT early so you can plan your finances accurately.

2. Legal Fees and Disbursements

By law, all real estate transactions in Ontario require a licensed lawyer to complete the closing.

Legal fees cover services like document preparation, title review, and fund transfers.

Disbursements include costs such as title searches, registration fees, and administrative charges.
💡 At Philer AI, we offer transparent, all-in-one pricing—with digital signing, remote ID verification, and legal support, all from your phone or computer.

3. Title Insurance

Title insurance protects you from ownership disputes, fraud, and other issues that may arise after closing.

While it isn’t legally required in Ontario, most mortgage lenders will insist on it.

It’s usually a one-time payment, arranged through your lawyer during closing.
Philer AI can coordinate this entirely online, making the process fast and secure.

4. Home Inspection (Optional)

Though not a legal requirement, many buyers choose to inspect the property for hidden issues before or even after finalizing the deal.

A professional inspection can identify concerns with the structure, systems, or safety.

It’s also a helpful step in future-proofing your investment.
Philer AI works closely with real estate agents to ensure inspection findings are addressed legally when needed.

5. Appraisal Fee

Lenders often require a property appraisal to verify the market value before finalizing your mortgage.

This is typically requested by the lender but may be your financial responsibility.

Ask your lender upfront if the fee is covered.
We help coordinate appraisal details as part of our digital legal checklist.

6. Mortgage Insurance (If Applicable)

If your down payment is below a certain percentage, you may need to pay for mortgage default insurance.

While the premium is often rolled into your mortgage, the provincial sales tax (PST) on the insurance must be paid on closing.
Philer AI ensures all mortgage-related taxes and insurance documents are handled efficiently through our virtual platform.

7. Prepaid Costs and Adjustments

These are reimbursements to the seller for expenses they’ve already covered—like property taxes, utilities, or condo fees.

The amount depends on the timing of your closing and the seller’s payments.

Your lawyer will calculate this and include it in your final statement of adjustments.
Philer AI provides clear breakdowns of all adjustments in your digital closing package.

8. Utility and Service Connection Fees

Setting up hydro, gas, water, internet, and cable often involves connection charges.

These fees vary by region and provider.

Booking installations in advance helps avoid delays or service gaps.
We’ll provide a utility checklist during your closing to help you stay organized.

9. Moving Costs

Moving isn’t a legal fee—but it’s still an important part of closing day planning.

Whether you’re hiring professionals or doing it yourself, build this into your budget.

Remember to factor in boxes, packing supplies, and vehicle rentals if applicable.
At Philer AI, we help you coordinate timelines so your legal closing and move-in date align smoothly.

10. Status Certificate (Condos Only)

If you’re purchasing a condominium, a status certificate is needed to confirm the building’s financial and legal standing.

It outlines fees, reserve fund status, bylaws, and pending legal matters.

This document is typically requested and paid for by the buyer.
Philer AI reviews status certificates thoroughly as part of your condo closing process.

Case Study: What Closing Costs Look Like for a $400,000 Home in Ontario

Let’s say you’re purchasing a home in Ontario valued at $400,000. In this case, you can expect to budget for several key closing costs. For a first-time homebuyer, the closing costs can range from $4,000 to $8,000+, even after applying eligible rebates. You may owe around $475 in Land Transfer Tax after the $4,000 first-time buyer rebate, plus legal fees and disbursements between $1,200 and $2,000. Title insurance typically costs $250 to $500, and if your down payment is under 20%, you’ll pay 8% PST on your mortgage insurance premium (approximately $960 on a $12,000 premium). Other potential costs include prepaid property adjustments ($300–$1,000+), a home appraisal ($300–$500), a home inspection ($300–$600), utility setup fees ($100–$300), and moving expenses ranging from $100 to over $1,500. Budgeting ahead and working with a digital law firm like Philer AI helps ensure your closing day is stress-free, transparent, and fully virtual.

🎯 Why Closing Costs Matter

Closing costs in Ontario can vary widely depending on the property type, location, and lender requirements. Planning ahead can prevent last-minute stress—and at Philer AI, we make sure you’re never caught off guard. Our virtual law firm delivers real-time updates, transparent fee estimates, and paperless closings, designed for today’s homebuyers.

✅ Closing Cost Summary Checklist

Here’s what you might encounter during your Ontario home purchase:

Land Transfer Tax

Legal Fees and Disbursements

Title Insurance

Home Inspection

Appraisal Fee

Mortgage Insurance PST

Prepaid Property Adjustments

Utility Setup Fees

Status Certificate (condos only)

Moving Expenses

Frequently Asked Questions – Answered by Philer AI

1. What should I do if I encounter a title dispute after purchasing my home?

If a title issue arises—such as a lien or ownership claim—your first step should be to contact your real estate lawyer. At Philer AI, we assist you in filing a claim with your title insurance provider, which can often cover legal costs and financial losses. Our digital legal team will also investigate the issue and offer advice on your next steps, all through our secure online platform.

2. How can I effectively negotiate closing costs with the seller?

While many closing costs are fixed, some—like property tax adjustments or repair credits—may be negotiated during your Agreement of Purchase and Sale. In certain cases, especially in new construction or slow markets, sellers may offer incentives to cover some of your costs. Philer AI works alongside your realtor to ensure all negotiated terms are clearly outlined in your legal documents before closing.

3. Are there specific costs I should be aware of when buying a new build home?

New builds in Ontario often come with unique fees such as development levies, Tarion warranty enrollment, and utility setup charges. In some cases, HST may not be included in the listed price. Our legal team at Philer AI reviews every clause in your builder agreement to flag additional costs early—giving you complete clarity through your online dashboard.

🔐 Close with Confidence—Digitally

At Philer AI, we’re transforming how Ontario closes real estate deals. No in-person meetings. No paper trails. Just licensed legal expertise, online convenience, and zero surprises. Whether you’re buying your first home or your fifth, our digital real estate law firm is designed to make your experience smooth, simple, and secure.

📲 Ready to close online? Book a virtual consultation at www.philer.ai