What Are Closing Costs for Sellers in Ontario? A Line-by-Line List

Seller closing costs are the charges that come off your sale proceeds on or before closing. Some are certain, some depend on your mortgage or your type of property, and a few are optional. Knowing which is which helps you price your home and plan your next move.

This list goes through each item in plain language. Amounts that depend on negotiation, such as commission and legal fees, are not set by law in the material reviewed here, so get written figures before you list.

The core costs almost every seller sees

Ontario describes seller costs as commission, HST on commission, legal fees and disbursements, mortgage payout or penalty, and adjustments. Land transfer tax is not on that list because only the buyer, who tenders the conveyance for registration, pays it.

Costs that depend on your situation

• Condominium status certificate: under the Condominium Act, 1998, the corporation provides it, and the fee, including all required material, cannot exceed $100 inclusive of all applicable taxes.
• Land registry copies: a parcel register copy with its first page is $36.50 in total, each extra page is $2.56, and viewing and copying an instrument is $3.39 per document.
• Tenanted property: a buyer who takes title steps into the landlord's role. A landlord may collect no more than one month's rent as a deposit, it can only be applied to the last month of the tenancy, and interest must be paid on it every year. How that deposit and interest are handled on a sale is worth raising with your lawyer.
• Estate sales: Estate Administration Tax is paid when applying for the estate certificate, and it is $15 for every $1,000 of estate value above $50,000, with no tax at $50,000 or less. Ontario real estate is counted net of encumbrances at its appraised value at the date of death.

Remember that the estate pays this tax, not the personal representative.

The mortgage line deserves a closer look

If you sell before your mortgage term ends, paying off the whole mortgage can trigger a prepayment penalty. The penalty is usually the higher of three months' interest on what you still owe or the interest rate differential. In the Financial Consumer Agency of Canada example, a penalty of $12,000 applied where three months' interest would have been $3,000, and an administration fee may be added.

Two ways this cost can shrink are worth asking about. First, if you are buying another home, ask whether your lender allows you to port the mortgage. Second, if your mortgage runs longer than five years, the Mortgages Act and the Interest Act contain a five-year rule that lets the borrower pay what is owed plus three months' interest. That rule excludes mortgages given by corporations and certain other borrowers.

If a lender cannot be found or a proper discharge cannot be obtained without undue delay, the court may allow payment into court and order the mortgage discharged. This is uncommon, and your lawyer would guide you.

Costs that are optional or avoidable

• Porting a mortgage may be an option if you are buying another home, so ask your lender.
• Commission, legal fees and any extra services you choose to add are negotiable or optional in the sense that you can compare and decide before signing.
• HST on your sale price is generally not payable on a typical used-home resale.

What to do next

• Request a written mortgage payout figure and ask directly about porting.
• Get your commission terms in writing and calculate the 13% HST on top.
• Obtain at least one written legal fee quote that lists disbursements.
• If you own a condominium, ask for the status certificate fee and make sure it is within the $100 cap.
• Plan for the tax reporting of a principal residence sale with your accountant.

Frequently asked questions