Once your bid for your dream property has been accepted, there is still so much to do before you can call the house trully yours. {In the following article, an experienced real estate agent will familiarize you with the most important pitfalls of the process.}
Once the offer has been accepted, your legal adviser should explain to you your liabilities under the contract. Your solicitor should help you to understand all the expenses related to the closing procedures, including Land Transfer Tax, disbursements and legal fees.
UTILITIES
The solicitor will also send letters to all the concerned municipal or regional utility departments, in order to confirm there are no arrears or outstanding charges for gas, water or hydro expenses. These letters also verify if the equipment on the property is rented or owned and they also advise the various utility departments of the planned closing date, the new owner’s name and the name of the vendor’s attorney. Details about the billing type and whether the billing is metered, all this is also asked for by these letters.
TAXES
A Tax Certificate is asked by your attorney to verify the amount of the current year’s taxes and to inquire as to arrears and outstanding charges for taxes for the current year and any previous years.
BUILDING & ZONING
A letter is sent by your legal adviser to the Building and Zoning Department along with a copy of the survey for the property to disclose the full particulars of zoning by-laws and restrictions relating to the distance from the street and side and rear lines, type of construction, lot areas and building areas, lot frontage and depth requirements and permitted uses.
TITLE & EXECUTION SEARCH
The appropriate division of the Land Registry Office will begin a Search of title to the property in order to find out whether or not the seller is the owner of the property and whether or not he has the legal right to convey the property. The search also reveals if the property is not a subject to any encumbrances, encroachments, easements, liens, agreements or mortgages that were not revealed in the Agreement or Purchase and Sale. Also an execution search is completed in the appropriate Sheriff’s Office to make sure that there are no executions against the vendor or previous owners of the property that would affect your title.
FINANCING
All the initial searches we have just outlined are taken care of by your solicitor. In the meantime, it is up to you to make all the necessary arrangements concerning the financial side of the deal. You should have decided, before signing the Agreement of Purchase and Sale, the amount of financing you will qualify for and the amount you will require to complete the business. There are always some costs related to mortgage financing that you haven’t known about on the day of closing. Again, it is a good idea to ask your solicitor about these fees, when you get the Mortgage Commitment Letter from the financial institution that you have chosen.
BEFORE THE DAY OF CLOSING
A few days before the closing, you will need to come to your attorney’s office to sign all the necessary documents and to produce a certified cheque to verify the balance of closing funds.
CLOSING DAY
Your legal adviser will arrange a meeting with the vendor’s legal adviser at the appropriate Land Registry Office to subsearch the title and finish the execution searches. The solicitors will exchange all the documents, keys and cheques and your solicitor will attend to the registration of all the necessary documents. As soon as this has been completed, you can get the keys and the vendor will get the funds.
AFTER CLOSING
Now your solicitor will provide you with a reporting letter that certifies your title and explains all the transaction details. Then you are at last free to move in to your new home! Just make sure to check that all items that should be included in the purchase price, as indicated in the Agreement of Purchase and Sale, are left on the property by the vendor. Let your lawyer know without any delay if you think something is absent.
