Sellers often focus on what they'll net from the sale, but it's important to understand what comes off the top before you get there. Here are the main costs to plan for.
Legal fees.
Your lawyer handles the transfer of title, payout of any existing mortgage, and coordination with the buyer's lawyer. Based on a quote from Maxime Bourgeois at Bourgeois Chiasson Avocats in Memramcook, seller legal costs typically come to approximately $1,138.50, including HST on legal and office fees.
That breaks down as:
- Legal fee (sale of a home): $900.00
- Photocopies, supplies, postage and deliveries: $75.00
- Land registration system usage: $15.00
- HST on legal and office fees: $148.50
- Total: $1,138.50
One additional item to be aware of: some financial institutions require the lawyer to register the mortgage discharge on their behalf. If yours does, that adds $85.00 as a disbursement.
Real estate commission.
Commission is negotiated as part of your listing agreement and is paid from your sale proceeds at closing. It covers both the listing side and the buyer's agent, and is subject to HST. I'm happy to walk you through how this is structured when we meet.
Outstanding mortgage balance.
If you have a mortgage on the property, it gets paid out from the sale proceeds at closing. Depending on your lender and mortgage terms, there may also be a prepayment penalty. It's worth checking with your lender before listing so there are no surprises.
Property tax adjustments.
Property taxes are paid in a lump sum in New Brunswick, and the closing statement will include an adjustment based on your closing date. If you've pre-paid taxes beyond your possession date, you'll be credited. If taxes are owing for the period up to closing, that amount is deducted.
Note: The fees above are based on quotes from Maxime Bourgeois at Bourgeois Chiasson Avocats in Memramcook. Every lawyer is different, and your actual costs may vary. I always recommend connecting with a real estate lawyer early in the process so you know exactly what to expect.