First-Time Buyer Mortgage Planning Guide › Chapter 8
How much cash do I need at closing?
By Rajiv Verma, Mortgage Broker · Mortgage Architects, FSRA Brokerage Licence #12728 · Updated November 3, 2026
Short answer: plan for roughly 1.5% to 4% of the purchase price on top of your down payment. The biggest piece is usually land transfer tax, even after the first-time buyer refund. Lenders also want to see that you have enough for closing costs before they approve you.
What are the closing costs, line by line?
Example for a first-time buyer outside Toronto (for example, Brampton or Mississauga). Ranges are typical, not quotes.
| $600,000 home | $800,000 home | $1,000,000 home | |
|---|---|---|---|
| Ontario land transfer tax | $8,475 | $12,475 | $16,475 |
| First-time buyer refund | −$4,000 | −$4,000 | −$4,000 |
| Land transfer tax you pay | $4,475 | $8,475 | $12,475 |
| Legal fees and disbursements | Get 2–3 quotes | Get 2–3 quotes | Get 2–3 quotes |
| Title insurance | A few hundred dollars | A few hundred dollars | A few hundred dollars |
| Tax on insurance premium (if insured) | See Chapter 5 | See Chapter 5 | See Chapter 5 |
| Home inspection | Optional, recommended | Optional, recommended | Optional, recommended |
| Property tax and utility adjustments | Depends on closing date | Depends on closing date | Depends on closing date |
| Home insurance | Proof of coverage required | Proof of coverage required | Proof of coverage required |
Nobody told me this
Buying in Toronto? You pay a second, municipal land transfer tax, roughly the same amount again, with a separate first-time buyer rebate of up to $4,475. On an $800,000 Toronto home, total land transfer tax after both rebates is about $16,475.
Nobody told me this
The first-time buyer refund covers all of the Ontario land transfer tax only on homes up to about $368,000. In the GTA, almost every first-time buyer still pays thousands.
Is there a tax credit for first-time buyers?
Yes. The federal Home Buyers’ Amount (line 31270, often called the First-Time Home Buyers’ Tax Credit) lets you claim $10,000 on your tax return for the year you buy, worth up to $1,500 off your federal tax. It’s non-refundable, so it reduces tax you owe rather than paying you cash. You generally qualify if neither you nor your spouse or partner lived in a home either of you owned in the current year or the previous four. You can split it with your spouse or partner, up to $10,000 combined. Confirm with your accountant.
What else should I budget for?
- Moving costs, and any overlap with your rent
- Condo status certificate (condos)
- Appraisal fee, if your lender charges one
- Furniture and the first repairs (not closing costs, but they come right after)
How do I plan for it?
- Estimate your total with my free mortgage app.
- Keep that amount in savings on top of your down payment.
- Ask your lawyer for a written quote early.
Why do I need more cash at closing? → · Legal costs and your lawyer →
Frequently asked questions
Do first-time buyers pay land transfer tax in Ontario?
Yes, but they get a refund of up to $4,000 on the Ontario tax, and up to $4,475 on Toronto’s tax if buying in Toronto.
Can closing costs be added to my mortgage?
Generally no. Lenders want to see them covered from your own funds.
How much should I budget for closing costs?
Roughly 1.5% to 4% of the price, on top of your down payment.
Next up · Chapter 9I love the house, but it needs work.Continue reading →
Questions about your situation?
Let’s look at your full picture over a free 30-minute Coffee Chat.
Book your free First-Time Buyer Coffee Chat Download my free mortgage app →
Need a Realtor or a real estate lawyer? I can refer you to people I work with. Ask me during your Coffee Chat.
Rajiv Verma, Mortgage Broker · Mortgage Architects, FSRA Brokerage Licence #12728 · 15 Gateway Blvd, Unit 201, Brampton, Ontario · Office 289.505.0631 · Direct 647.291.7116
This guide is general education, not personal financial, legal or tax advice. Rates shown are examples as of November 3, 2026, for comparison only, and are not a quote or a commitment to lend. Your rate and approval depend on your application, credit, income, property and lender guidelines. Program rules can change.