November 6th, 2017 by Nancy Ling

Buying a house can be a daunting prospect, if you are not sure what to expect. There are many steps to completing the purchase of your home, and knowing what is involved can take some of the stress out of the experience.

Most people start with their realtors and mortgage brokers to find the perfect home within your budget. Your realtor will help you draw up a contract of purchase and sale in order to make an offer on the property. This offer should be conditional and should give you time to go and do some homework. Some examples of conditions on your contract should be; subject to getting a commitment for mortgage financing, subject to getting a home inspection, subject to getting home insurance approved, and subject to legal advice. In addition to calling a home inspector and setting up your home insurance, you should also get in touch with your lawyer as soon as possible when purchasing real estate.

You should contact your lawyer before you remove the “subject to” conditions on your offer, after which point you become legally bound to complete the purchase. Your lawyer will help you review, among other things, the deal, the contract and the state of legal title to the property. You and your lawyer will be able to discuss issues particular to strata properties, new construction, rental properties, and properties with deficiencies or damage. Your lawyer will also be able to walk you through the procedure of closing on your real estate purchase and what kind of closing costs you should be budgeting for. For example, you should take into consideration legal costs, property transfer tax, GST, fees for strata certificates and title insurance as well as pro-rated adjustments for municipal property taxes, strata fees and utilities.

Once you remove the conditions on your purchase, often called ‘subject removal’, your lawyer will start preparing for closing the transaction and transferring legal title, including making inquiries about outstanding property taxes, utilities, and strata fees. The lawyer will also review the legal title for possible liens, such as Builders’ Liens, Certificates of Pending Litigation, or government liens. If you are buying a Condo, your lawyer will coordinate with the Strata Corporation, and confirm strata fees, and any other amounts owing on the property.

There will be several legal documents that require your signature before closing; be sure to tell your lawyer if you are going out of town. The lawyers for the purchaser and the vendor coordinate to prepare a “statement of adjustments” where all the numbers are worked in; the purchase price, the property transfer tax, GST, the deposit, the real estate commissions, each party's share of taxes, utilities and strata fees, etc… If you are using a mortgage, your lawyer will also start preparing all of the documents required by your lender to secure the loan against the property.

You should expect to meet with your lawyer to sign the closing documents a few days before your closing date. That is also usually the time when you bring in your down payment. You can bring a bank draft to your signing appointment, which then allows your lawyer to do the few remaining steps to transfer the property into your name on the closing date.

The process of purchasing a home has a lot of moving parts. The best first step when purchasing real estate is to give a call to a real estate lawyer, who can explain the process to you, and answer your specific questions and concerns. Buying a home is an important undertaking and a big investment; you should find a legal advisor that you trust and rely on their expertise to help, so that you can enjoy the process of acquiring your new home.