Cost of Purchasing a Property
Loan Application FeeThis is a fee which is charged by a lending body when a formal loan application is made.
Approximate cost: $Nil - $750
Settlement/Legal FeesThis is the fee which is charged by the lenders solicitors for preparation and registration of the mortgage. This is usually incorporated as part of the application fee.
Approximate cost: $Nil - $500
Valuation FeeYour lender will usually require a formal valuation of the property for lending purposes. This fee may be included in the application fee charged by your lender.
Approximate cost: $Nil - $300
Mortgage InsuranceThis type of insurance is required when the buyer is borrowing more than a set proportion of the valuation as specified by the lender (usually 80%). This insurance protects the lender against loss should the borrower default and the property be sold for less than the outstanding loan amount. Premiums vary according to the amount borrowed and the loan-to-value ratio (LVR). The mortgage insurance premium is a once-only payment.
Approximate cost: 0.40% - 3.00% of the amount borrowed.
On a $350,000 loan at 95% LVR the premium would be approximately $7,600
Survey ReportA survey shows where the property is in relation to the boundaries of the land. Lenders often require a survey report.
Approximate cost: $350 - $450
Conveyancing FeesConveyancing means the process of transferring the ownership of property from the seller to the buyer. You can engage a solicitor or conveyancer to do this or you can do it yourself. There are no set fees charged by solicitors or conveyancers for conveyancing. You should negotiate with the solicitor or conveyancer and obtain a written estimate of the likely costs before engaging them to act on your behalf.
Approximate cost: $400 - $1,500
DisbursementsYour solicitor/conveyancer will charge for expenses incurred on your behalf during the conveyancing of the property. Some of these documents may be included in the Contract of Sale.
|Title Search||$20 - $60|
|Local Council, Section 149||$40-$100|
|Local Council, Building Certificate (S149D)||$50|
|Water Board (S66)||$20|
|Environmental Protection Authority (S5)||$10|
|Department of Education and Training||$11|
|Land Tax (S47)||$15|
|Roads and Traffic Authority||$20|
|Transgrid (Electricity/Power Stations)||$21|
Stamp DutyContract Duty is payable on the purchase price of the property (or valuation in certain circumstances). Duty must be paid within three months of the date of exchanging contracts, unless buying "Off the Plan" or a house and land package.
Mortgage Duty is payable on the mortgage. A fee applies to register the mortgage and a further fee applies to register the transfer document or discharge of an existing mortgage. Stamp Duty rates and registration fees vary from state to state. To work out the stamp duty applicable in your state use our Stamp Duty Calculator
Inspection FeesBuilding Inspection
A building inspection checks structural soundness, indicating visible quality defects and necessary repairs.
Approximate cost: $275 - $440
A pest inspection checks for any signs of past or present pest infestation.
Approximate cost: $140 - $220
A strata inspection examines and reports on the written records of the owners corporation. It is additional to the certificate supplied to the buyer by the seller providing relevant information about strata levies, insurances etc.
Approximate cost: $165 - $220
Home Building InsuranceIt is suggested the buyer arrange home building insurance prior to completion of the purchase.
Two types of insurance cover are available:
Replacement Cover: This type of cover pays to reinstate your property to its former condition. It means, simply, new for old.
Indemnity Cover: This type of cover pays to repair or reinstate your property taking into account depreciation on the dwelling.
Approximate cost: $220 - $330
Council and Water Rates AdjustmentThe buyer and seller share these costs in proportion to the length of time each party owns the property during the rating period.
Electricity ReconnectionThe electricity is usually disconnected upon change of property ownership.
Approximate cost to reconnect: $Nil (normal working hours) or $95.50 (outside normal working hours)
Telephone ReconnectionTelephone lines are usually disconnected upon change of property ownership.
Approximate cost to reconnect: $55 (where phone connected previously) or $191 (where phone not connected previously)
Removalist CostsRemovalist costs vary considerably due to factors such as location, amount and quality of furniture; and type of packing (by owner or removalist).
Approximate cost: $550 - $3,000
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