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What are disbursement costs and why do they matter?



Buying or selling a home is often one of the biggest transactions during our lifetime. Understanding all of the elements involved is key to making the best financial decisions.


The definition of disbursement is the payment of money from a fund. Essentially, when you buy or sell a home, your lawyer will facilitate the movement of money for a variety of costs related to the sale.


Disbursement fees are expenses that your lawyer pays on your behalf to facilitate the purchase of sale of your home, they are then added to your closing costs for reimbursement. We often get asked exactly what these fees entail and why they are necessary to the transaction. Today, we're going to break down the typical disbursement expenses we see during a real estate transaction.


They include:


Deed Transfer Tax


The Deed Transfer Tax is a municipal tax applicable when a property or land is purchased. Deed Transfer Tax (DTT) rates are set by each municipality. In the Halifax Regional Municipality the DTT is 1.5% of sale price.


Registration & Recording Fees


Every time a document is registered in the Land Registration system, a fee applies. In a

typical purchase, there is a deed and mortgage registered. These fees are mandated

by the Nova Scotia government so it is best to ask your lawyer ton confirm the current fee.


Title Insurance


Close your deal faster while protecting yourself against losses associated with title fraud or survey and title defects by purchasing title insurance. Without it, you may face unexpected costs or have your ownership questioned, even years later which effects your ability to sell in the future.


General operating expenses


During a home sale, there are a number of operating expenses that the firm incurs. These include courier, postage, photocopies and faxes. Additional title searches or tax inquiries would also be included here as well.


Disbursement fees are in addition to other common closing costs, including fuel adjustment, property taxes, rental adjustment, condo fee adjustment and title insurance.


If you have any questions about closing costs or disbursement fees, please feel free to contact us at any time!

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