Wednesday Mar 17th, 2021


Sellers have closing costs associated to them.  Both buyers and sellers have different closing costs and each will pay their own respective closing costs.  The respective lawyers will handle making the appropriate payments and will then provide you with one final bill you owe to them.

In this post, we’ll take a closer look at the closing costs for a seller.  As a seller, you can expect the following closing costs:

1. Early Mortgage Discharge Penalty

This is charged by your bank, as a penalty for breaking the mortgage term early. The penalty will differ based on the type of mortgage term.  Variable and Fixed terms have different penalties. Fixed rate mortgage terms have to pay the greater of interest rate differential (IRD) or 3 months interest, while variable rate mortgage terms only pay 3 months interest.

2. Mortgage Discharge Fee

This is a “good-bye kiss” fee charged by the bank to prepare all the paperwork and documentation.

3. Real Estate  Commissions

Usually, the seller pays both of the real estate commissions.  The listing brokerage prepares your home to be sold.  They list and market the property and review the offers received.  The co-operating or buying brokerage represents the buyer in the transaction.

4. Lawyer Fees

The real estate lawyer handles the closing of the real estate transaction. They ensure all the paper work is done correctly and all parties are paid out accordingly.  They charge a fee for their professional services.

5. HST on Real Estate Commissions & Lawyer Fees

As always, you have to pay government taxes on the services

6. Disbursements

These are charges that depend on various scenarios.  Some of the charges you will see in the disbursements are unpaid property taxes or utility bills, courier fees, photocopying, etc.


Normally, these closing costs are deducted from the amount owed to you by the lawyer’s office from the proceeds of the sale of your home. If the closing costs are higher than the net amounted from the sale of your home, you will be responsible for paying the remaining portion.

Surprised? Well, at least now you know what costs to expect when you are selling.  Remember, closing costs can differ based on each scenario.

Are you thinking of selling, but not sure how much it’s going to cost you to sell? Do you want to know what closing costs you might incur? Let’s sit down and review them together.  Allow us to help you plan for these costs!

Tags: closing - seller - selling

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