Once your offer 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 realtor will point out the most important details of the process.}
As soon as the owner has accepted your offer, you should meet with your legal adviser and talk about all the obligations under the contract. Your lawyer should help you to understand all the costs related to the closing procedures, including Land Transfer Tax, disbursements and legal fees.
UTILITIES
It is also necessary to verify the absence of any arrears or outstanding charges, such as gas, water or hydro expenses. Your attorney does this by sending letters to the municipal or regional utility departments. The utility departments will also be informed if the equipment on the property is rented or owned, and also about the planned closing date, the name of the new owner and the seller’s solicitor. Details about the billing type and whether the billing is metered, all this is also demanded by these letters.
TAXES
A Tax Certificate is requested by your attorney to confirm 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
Your lawyer will also send a letter to the Building and Zoning Department, together with a copy of survey for the property. The purpose of this is to find out all the particulars of zoning by-laws and restrictions concerning the distance from the street and side and rear lines, construction type, lot and building areas, lot frontage and depth requirements and permitted uses.
TITLE & EXECUTION SEARCH
A Search of title to the property is commenced in the appropriate division of the Land Registry Office to determine whether or not the seller is the owner of the property, whether or not he has the right to convey the property, and that the property is not subject to any encumbrances, encroachments, easements, liens, agreements or mortgages that were not disclosed in the Agreement or Purchase and Sale. The appropriate Sheriff’s Office will do an execution search to confirm there are no executions against the vendor or prior owners of the property. If there were any, they would affect your title.
FINANCING
While your legal adviser is doing his initial searches, it is your responsibility to make necessary arrangements for financing. Already before signing the Agreement of Purchase and Sale, you should have decided the amount of financing you will qualify for and the amount you will need to finish the transaction. There are a number of expenses that you may not expect on the day of closing that relate to mortgage financing. Your lawyer can advise you of these fees when the financial institution that you chose provides you with a Mortgage Commitment Letter.
BEFORE THE DAY OF CLOSING
You will also need a certified cheque to verify the balance of closing funds to your lawyer. Bring this with you when you come to sign all the documents needed a few days before the closing.
CLOSING DAY
Your lawyer will agree to meet with the vendor’s solicitor at a mutually convenient time at the appropriate Land Registry Office where he will sub-search title and complete final execution searches. They will exchange documents, keys and cheques and your solicitor will make sure all the necessary documents are registered. After the documents registration, the seller is entitled to get the money and you can get the keys from your attorney.
AFTER CLOSING
After the closing process has been completed, a reporting letter will be prepared by your lawyer. This letter will certify your title and explain all the details of the transaction. Then you are at last free to move in to your new place! Just make sure to check that all items that should be included in the purchase price, as described in the Agreement of Purchase and Sale, are left on the property by the seller. Let your legal adviser know without any delay if you believe something is missing.
