Closing Costs, Title Insurance & RPR

Under the standard Alberta residential purchase contract (AREA contract), the seller is required to provide the buyer with a current RPR along with a municipal compliance stamp — a certificate from the municipality confirming that all structures on the property comply with local bylaws and have the proper permits. "Current" means the RPR accounts for all structures on the property. An RPR can be years old and still be considered current, as long as nothing has been added, removed, or modified since it was prepared.

A new RPR typically costs $500–$950 to prepare, plus $100–$200 for the municipal compliance review. This is the seller's expense — not yours as the buyer. Condominiums (except bare land condos) are exempt from the RPR requirement.

Your lawyer handles the legal work of transferring the property and registering the mortgage. Title insurance covers the risks that even the best lawyer can't catch — hidden title defects, forged documents in the property's history, or problems that only surface after closing. It also covers certain issues that an RPR would reveal, like encroachments or missing permits, which is why some sellers offer title insurance instead of an RPR.

Here's the practical reality in Alberta right now: the Land Titles Office is running 4–6 weeks behind on registrations. Your closing happens and money changes hands long before your title is actually transferred and the mortgage is registered. Title insurance bridges that gap — it guarantees your ownership during that waiting period. For this reason, virtually all purchase transactions in Alberta now require title insurance regardless of whether the seller provides an RPR.

Cost: $200–$400 one-time premium. The policy lasts as long as you own the property. No annual renewals.

Think of it this way: an RPR shows you what you can see — buildings, fences, boundaries, and whether everything has the proper permits. Title insurance protects you against what you can't see — hidden title defects, fraud, liens, and errors in public records. An RPR gives you certainty about the physical property. Title insurance gives you financial protection if a problem surfaces later.

The standard AREA purchase contract requires the seller to provide a current RPR with compliance. However, many sellers now offer to pay for title insurance instead — it's cheaper for them ($200–$400 vs $600–$1,100+ for a new RPR with compliance). If you accept title insurance in lieu of an RPR, you're giving up the physical survey in exchange for an insurance policy that pays out if something goes wrong.

Even if the seller provides an RPR with compliance, your lawyer will almost certainly still require title insurance because of the Land Titles registration backlog. So in practice, most buyers end up with both — the seller provides the RPR, and the buyer's lawyer arranges title insurance at closing.

Typically covered: title fraud, forged documents in the property's history, unknown liens or charges on title, encroachments of your structures onto municipal land or easements, missing or incomplete building permits for existing structures, errors or omissions in the Land Titles registry, zoning compliance issues that existed before you bought, and work orders from the municipality for interior renovations.

Typically NOT covered: defects you knew about before purchasing, encroachments between your property and a neighbour's property (only encroachments onto municipal/public land), future bylaw changes or new municipal requirements, environmental contamination, First Nations land claims, and anything specifically excluded in your policy. If an RPR exists and shows a defect, and you bought the property knowing about it, the title insurance policy will generally not cover that defect.

Under the standard AREA purchase contract, the seller is obligated to provide a current RPR with compliance. But many sellers negotiate to provide title insurance instead — especially if they don't have a current RPR, if the property has had additions or changes since the last survey, or if the compliance process would reveal issues they'd rather not address before closing.

This is perfectly legal and increasingly common in Alberta. As a buyer, you have the right to insist on the RPR if the contract calls for it — but you should discuss the trade-offs with your realtor and lawyer. Sometimes accepting title insurance in lieu of an RPR is reasonable. Other times — particularly on older properties, properties with visible additions, or rural/acreage properties — an RPR provides information that title insurance simply cannot replicate.

The appraisal is ordered by the lender (or through your mortgage broker on the lender's behalf) to confirm the property's market value. Even though you pay for it, the report belongs to the lender — they are the appraiser's client, not you. You typically don't receive a copy of the appraisal report unless you specifically request it, and even then the lender may not share it.

Important exceptions: for insured mortgages (less than 20% down), the insurer — CMHC, Sagen, or Canada Guaranty — handles the property valuation. In most insured purchases, a full appraisal is not required. The insurer may use an automated valuation model (AVM) or desktop review instead. If the insurer does request a full appraisal, they typically cover the cost — not you.

For conventional mortgages (20%+ down), the lender almost always requires a full appraisal, and the buyer pays. For high-value properties above $1 million, some lenders require two independent appraisals, which adds cost and time to the file.

Appraisal: ordered by the lender to confirm market value. The appraiser compares your property to recent comparable sales in the area, considers the location, size, condition, and features, and provides a market value estimate. The lender uses this to determine how much they'll lend. Cost: $300–$600. Paid by you (usually). The report belongs to the lender.

Home inspection: ordered by you (the buyer) to assess the physical condition of the property. The inspector checks the roof, foundation, plumbing, electrical, HVAC, insulation, windows, and more. They identify deficiencies, safety issues, and maintenance concerns. Cost: $400–$800+. Paid by you. The report is yours.

A low appraisal affects your financing — the lender won't lend more than the property is worth. A bad inspection affects your decision to buy — you might renegotiate the price, ask the seller to fix issues, or walk away. Neither professional does the other's job.

Example: You offer $500,000 for a home and plan to put 20% down ($100,000) for a $400,000 mortgage. The appraisal comes back at $475,000. The lender will now only lend 80% of $475,000, which is $380,000. You now need $120,000 down instead of $100,000 — an extra $20,000 in cash you didn't plan for.

Your options when this happens: come up with additional cash to cover the shortfall, renegotiate the purchase price with the seller to match the appraised value, request a second appraisal (you may have to pay for it, and there's no guarantee it will be higher), or walk away from the deal if your conditions allow it.

Legal fees: $1,000–$2,000 (your lawyer handles the title transfer, mortgage registration, and disbursements). Title insurance: $200–$400 (one-time premium, arranged by your lawyer). Property insurance: $500–$1,500 per year (required by your lender before they'll fund — must be in place on closing day). Appraisal: $300–$600 (if required by lender — may be waived). Home inspection: $400–$800 (optional but strongly recommended). Mortgage registration fee: $50 plus $5 per $5,000 of mortgage amount. Title transfer fee: $50 plus $2 per $5,000 of property value. Property tax adjustment: varies (you reimburse the seller for any taxes they've prepaid beyond your closing date). Utility adjustments: varies (similar to property tax adjustment).

Costs you do NOT pay in Alberta: land transfer tax (Alberta doesn't have one — this saves you thousands compared to Ontario or BC), provincial sales tax on CMHC premiums (Alberta has no PST).

If buying new construction: add 5% GST on the purchase price. First-time buyers purchasing new builds under $1 million may qualify for the GST rebate under the current rules.

Property (homeowner's) insurance protects your home against fire, theft, weather damage, and liability. Your lender requires it because the property is their collateral — if it burns down the day after closing, they need to know their investment is protected. The policy must name the lender as a loss payee.

This is different from title insurance. Property insurance is ongoing (annual premiums, typically $500–$1,500+ in Alberta depending on the property). Title insurance is a one-time premium at closing. You need both. They cover completely different risks — property insurance covers physical damage to the home, title insurance covers legal problems with your ownership.

Your lawyer will need the insurance policy details before closing. Don't leave this to the last day — if there's any issue getting coverage (older home, wood stove, knob-and-tube wiring, rural location), it can delay your closing. Shop for insurance as soon as you have a firm purchase agreement.