Selling your home is not a cheap proposition. At every turn there is usually someone looking to make an extra dollar at your expense.

Even before you have listed your home for sale you may end up spending several hundred, or thousand, dollars just getting your home ready to be sold. Finishing all those minor repairs and adding a fresh coat of paint may not seem like it should cost a lot of money but inevitably, when you add up all those small $20 purchases, you end up spending a lot more than you ever expected.

A new trend is for home owners to hire a home inspector to go through their home even before they list it for sale. This allows the vendors to get an independent third party to give them an honest opinion of the condition of their home. This way any deficiencies can be dealt with, or at least recognized, before any potential Offer To Purchase is on the table.

Let's face it, most home buyers will hire their own home inspector to review your property so if there are any deficiencies the purchaser is going to find out about them. It's usually far better to deal with any potential issues before a buyer makes an offer than to bury your head in the sand and hope no one discovers the deficiencies. Even if you don't fix the problem you can at least identify it for the purchaser so that they are not scared off during their own home inspection. The cost to hire a home inspector is usually between $300 and $500. Prices will vary depending on who you use and the size of your house.

Once you are ready to sell you need to determine if you want to hire a realtor to sell your home or to try and sell your home yourself. If you hire a realtor you will need to negotiate the commission you are willing to pay the realtor to sell your home. If your home is in a desirable urban setting you should be able to negotiate the commission structure with your realtor. If your home is rural and off the beaten path you will usually have less negotiating power.

You can expect the negotiations to start at 6% of the home's value and work down from there. A realistic commission is between 4.5% and 5% of the list price. If you are planning on buying another home with the same realtor you may be able to negotiate an even better deal. Remember that you also have to pay 7% GST on the real estate commission.

If you decide to sell your home yourself you will avoid the real estate commissions but you will incur additional costs to market your home. Paying for ads in the local paper are not inexpensive and even buying a good sign for the front lawn can set you back a few dollars. You should also hire a real estate lawyer to prepare and review any Offer To Purchase.

Even if you decide to sell your home yourself, you may want to pay a realtor to bring his or her clients to see your home. The only way a realtor will show a prospective purchaser your home is if you are willing to pay them a commission if their purchasers agrees to buy your home. A commission of 2% to 2.5% of the purchase price is usually the norm for this sort of arrangement (plus GST).

Once you have sold your home you will need to hire movers or rent a truck. This is where planning is crucial. If you leave these details to the last minute you may be in for a nasty surprise. Hiring movers at the last minute will usually cost you more and will limit your options. Even finding a truck to rent for a busy long weekend, or for an end of the month closing, can be difficult if you don't book well in advance.

Chances are that you will have to pay off a mortgage when you sell your home. This can be a major expense so you should find out what sort of penalties you may incur long before moving day rolls around. If you are in a closed mortgage, you will usually incur a penalty equal to "three months interest, or an interest rate differential, whichever is greater". Every lender has its own policies on how to calculate penalties, so you really need to approach your lender to see what your penalty would be. Be sure to get it in writing because I have seen many borrowers get a verbal quote only to find that their lender "made a mistake" and in fact the penalty is substantially higher. Just to make you feel wanted, your lender will also charge you a "discharge fee" of somewhere between $125 and $200 dollars to prepare your discharge statement telling you how much you owe them.

There are a few ways to avoid the penalties involved in paying off your mortgage but you really need to plan in advance. You can try to have the purchaser of your home assume (take over) your mortgage or you can port (transfer) your mortgage to a new property that you are buying.

Both of these options are great in theory but are seldom ideal. Finding a buyer who wants to take over your mortgage is usually next to impossible because you need to find a buyer who will accept your interest rate and the exact mortgage amount that you have. Such a buyer is rare. You may have a fighting chance if your interest rate is substantially lower than market rates.

If you want to port your mortgage to a new property you are essentially just moving your current mortgage to the new property. However, most people who sell one home to buy another home are usually up sizing or down sizing. It is not very often that you can just transfer your mortgage exactly as it is to a new property. You will usually need to increase or decrease the mortgage to meet your new needs. This means that you are left negotiating with your current lender. If you want to increase your mortgage you will usually be offered a "blended interest rate". Every lender has a different way of calculating their blended rates so it's really difficult to know if you are getting a good rate or not. You really need to talk to your financial planner, or mortgage broker, to crunch some numbers to determine if you are getting a good deal or not.

Another major expense will be your legal fees. You will need to hire a lawyer to finalize the transaction for you. The average cost to close the sale of your home and discharge a mortgage is usually around $750 plus disbursements, but every lawyer is different. Treat your lawyer like any other service provider and don't be afraid to shop around. Legal costs can be dramatically different from one lawyer to the next so be sure to ask what they charge well before you get their bill.

Selling a home is never inexpensive. All you can hope for is to minimize your costs and to prevent unforeseen costs. A bit of planning and number crunching will help make the whole process a little less stressful.

Good luck!

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Andy MacDonald is president of MortgageBroker Inc. He has more than 15 years' financial services experience and is a consumer advocate in the mortgage industry. To find out how he educates Canadians about how to save money on their mortgages, visit www.mortgagesincanada.com.