Closing Costs in Ontario (Explained): What First-Time Buyers Actually Pay

If you’re getting ready to buy your first home in Ontario, you’ve probably saved up for your down payment—but what about closing costs?

These are the extra expenses that come into play on closing day, and they can catch buyers off guard if they’re not planned for in advance. Let’s break down what you’ll actually pay and how to budget for it confidently.

🧾 The 5 Main Categories of Closing Costs

When buying in Ontario, your total closing costs generally range from 1.5% to 4% of the purchase price. Here’s what that includes:

1. Land Transfer Tax (LTT)
   
   
• Paid to the provincial government on closing.
  
  
• Scales with the purchase price (see example below).
  
  
2. Legal Fees & Disbursements
   
   
• Your real estate lawyer handles title transfer, mortgage registration, and closing documents.
  
  
• Expect $1,500–$2,500, depending on complexity.
  
  
3. Title Insurance
   
   
• Protects against fraud, undiscovered liens, or ownership disputes.
  
  
• Usually around $300–$500.
  
  
4. Adjustments
   
   
• Reimburse the seller for prepaid property taxes or utilities.
  
  
• Varies by timing and location.
  
  
5. CMHC / Mortgage Default Insurance (if applicable)
   
   
• Applies if your down payment is under 20%.
  
  
• Usually added to your mortgage balance, not paid upfront.
  
  

🏙️ Land Transfer Tax vs. Toronto MLTT

If you’re buying outside Toronto, you’ll pay the Ontario Land Transfer Tax (LTT) only.

But if you’re buying within Toronto city limits, you’ll also pay the Municipal Land Transfer Tax (MLTT)—essentially double tax.

Example on $800,000 purchase in Toronto:

• Ontario LTT: ~$12,475
  
  
• Toronto MLTT: ~$12,475
  ➡️ Total: ~$24,950
  
  

🎁 First-Time Buyer Rebates

Good news: First-time buyers get rebates that can significantly reduce their LTT burden.

• Ontario Rebate: Up to $4,000
  
  
• Toronto Rebate: Up to $4,475
  
  

This means if you buy in Toronto and qualify, your total land transfer tax could drop by nearly $8,500—a big help on closing day.

💰 Real Examples

You’ll also want to budget:

• Legal Fees: $1,800
  
  
• Title Insurance: $400
  
  
• Adjustments: $500–$1,000
  
  

✅ Total (outside Toronto): ~$10,000–$14,000
✅ Total (in Toronto): ~$18,000–$26,000

📅 When Are Closing Costs Due?

Most closing costs are paid on closing day—the day ownership transfers and your lawyer finalizes the transaction.
You’ll typically provide a certified cheque or bank draft to your lawyer covering the full amount.

It’s smart to keep 3–4% of your purchase price aside just in case, so nothing catches you by surprise.

💡 Final Thoughts

Closing costs aren’t fun—but they’re essential to plan for. When you understand them in advance, there are no last-minute shocks—and you can focus on celebrating your new home.

At Ana Bastas Realty, we walk every buyer through these numbers before offer time, so you can buy with confidence (and a clear budget).

📞 Call 289.670.5888 or visit www.anabastas.ca to get a personalized closing cost estimate for your price range and area.