When you're buying a home in Alberta, it’s easy to focus solely on the down payment. But as the "closing day" approaches, a different set of numbers enters the picture: closing costs.
In Alberta, we have some of the lowest closing costs in Canada (thanks to having no Land Transfer Tax!), but you still need to budget carefully. Here is exactly what is involved in the legal side of crossing the finish line.
1. Professional Legal Fees
This is the amount you pay for your lawyer’s expertise. Your real estate lawyer isn't just "signing papers"; they are:
Reviewing your purchase contract.
Conducting title searches to ensure no hidden liens exist.
Preparing and registering the Transfer of Land and Mortgage documents.
Managing the secure transfer of hundreds of thousands of dollars between you, your lender, and the seller.
What to budget: In the Edmonton area, base legal fees for a standard purchase with a mortgage typically range from $650 to $1,600 + GST, depending on the complexity and requirements of the file.
2. Lawyer Disbursements (Out of Pocket Expenses)
Disbursements are costs your lawyer pays to third parties on your behalf to get the job done. Think of these as "reimbursements." Your lawyer doesn't make a profit on these; they simply pass the cost through to you.
Common disbursements include:
Land Title Registration Fees: The Alberta Land Titles Office charges a fee to register the house in your name and register your mortgage. This is usually the largest disbursement.
Example: For a $450,000 home with a $400,000 mortgage, registration fees are approximately $950.
Here is a link to the breakdowns from land titles. https://www.alberta.ca/system/files/sartr-land-titles-and-surveys-common-documents-fee-schedule.pdf
Title Searches: Small fees (about $10–$15 per document) to pull the most current "snapshot" of the property's legal status.
Tax & Utility Searches: To confirm the seller is caught up on property taxes so you aren't stuck with their bill.
Courier, Photocopies & Software Fees: To securely transport documents and use specialized legal platforms for registration.
3. Other Closing Costs to Watch For
Beyond the lawyer's bill, there are a few other "possession day" costs that catch buyers by surprise:
Property Tax Adjustments: If the seller prepaid the property taxes for the full year, you must "buy back" the portion for the months you will actually own the home. This can range from a few hundred to a few thousand dollars.
Title Insurance: Most lenders require this. It protects you against issues like survey errors or title fraud. It's a one-time fee, usually between $200 and $500. But it can be more as it’s based on the property value.
Home Insurance (Binder Letter): You must have your home insurance active and provide proof (a "binder") to your lawyer before they can release your mortgage funds.
The "Rule of Thumb" for Alberta Buyers
While every deal is different, a safe bet is to set aside 1% to 1.5% of the purchase price for closing costs. For a $450,000 home, having $4,500 to $6,000 in a separate savings account will ensure you aren't scrambling on move-in day.
Alberta Real Estate Closing Cost Worksheet
Use these estimates to budget for your upcoming purchase in the Edmonton area.
Unlike other provinces, Alberta has no Land Transfer Tax. This saves you thousands of dollars compared to a buyer in Ontario or B.C. However, your lender will still require 'Certified Funds' or a Bank Draft for your closing costs, roughly 2–3 days before your possession date, so keep this cash accessible!
Given that lawyers and/or their firms each have their own independent business model and fee schedules, please make sure to reach out directly to them for costs, as we simply offer a ballpark and average of local costs.
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