Congratulations on the purchase of your home! Purchasing a home is one of the biggest decisions you will make in your life.
Once you have found that perfect home with your realtor and have your mortgage financing in place, the next step is to choose a lawyer.
CHOOSING A LAWYER
It is important to choose a lawyer to represent you on the purchase of your home as soon as possible. If you have included the condition on “lawyer review” in your Agreement of Purchase and Sale, please allow a minimum of 3-4 business days prior to the date set to waive the condition. As soon as the Agreement is firm (meaning that all conditions have been fulfilled), please inform your real estate agent which lawyer you have chosen. At that point, your real estate agent will fax or deliver the Agreement of Purchase and Sale on your behalf to the lawyer. It is your responsibility to follow up with the lawyer to confirm they have received the Agreement of Purchase and Sale. The lawyer requires the firm Agreement of Purchase and Sale in order to open a file & start working on your behalf.
HOW TO DECIDE WHICH LAWYER IS RIGHT FOR ME
• Ask your friends, family members, co-workers which lawyer they used for the house purchase & get their honest feedback on what the experience was like for them.
• Ask your real estate agent and mortgage broker for a recommendation to some of the lawyers they have worked with previously.
- Compare Price
• The lowest price is not always the best value. You may be unpleasantly surprised on closing at ‘additional costs’ that were not included in the quote.
• Ask for a quote from several law firms, confirm what items are included in the price and get the quote in writing, if possible.
- Check Availability
• Is the lawyer able to accommodate your closing date? Some dates are traditionally busy closing days, such as the last day of the month during the summer.
• Does the lawyer offer flexible appointment times? Will you be required to attend their office during the day or be required to take time off work?
• Is the lawyer available when you call?
• How long has the lawyer been in practice?
• What is the main focus of that lawyer’s practice? You should choose a lawyer who is a real estate lawyer, not necessarily your best friend’s divorce lawyer.
• A local lawyer that specializes in Real Estate Law will know all the legal technicalities of buying and selling a home in the region in which you are buying!
AFTER CHOOSING A LAWYER, WHAT HAPPENS NEXT?
- Instruct your Financial Institution to forward your mortgage instructions to your lawyer as soon as possible. Confirm with your Mortgage Broker that all your conditions for financing have been fulfilled & sent into the financial institution. Follow up about 2-3 weeks before closing with the lawyer’s office to make sure your mortgage instructions have been received by your lawyer. Most law firms have an additional charge should they not receive mortgage instructions more than 2 business days in advance of your closing date.
- Prior to closing you must instruct your House Insurance Agent to place fire insurance coverage, “guarantee replacement cost value” on the property effective the closing date, showing loss payable to your mortgage company as first mortgagee. Ask your insurance agent to send a copy of the “Binder Letter” to our office.
What does the lawyer do?
- Conducts a title search and related inquiries related to assuring you of clear title.
- Advises you on any title-related issues affecting the home purchase.
- Prepares the mortgage(s) and/or line of credit documents.
- Ensures registration under New Home Warranty Program (new home construction).
- Confirms price and other adjustments on the Statement of Adjustments, requisition correction of any title deficiencies.
- Check for liens on Title (for example, Construction Liens).
- Check for executions against the owners.
- Advises you regarding Title Insurance versus obtaining a Solicitor’s Opinion on Title and the costs associated with each.
- Reviews the Agreement of Purchase and Sale and/or Status Certificate (for condominiums).
- Determines how you are to take title to the property (Joint Tenants or Tenants in Common).
- Conveys the property to you by registering the property in your name as per your directions.
APPOINTMENT WITH THE LAWYER
Approximately two to three days prior to the closing date your lawyer will meet with you to review and sign the documentation required for closing. At the time of the appointment, you will be required to produce 2 pieces of identification. Your lawyer is bound by the mortgage instructions set out by each financial institution to verify your identity via the appropriate forms of identification. Each financial institution has its own requirements for acceptable identification. You will be required to provide valid photo identification, such as a valid driver’s licence, valid passport or a landed immigrant card.
The secondary piece of identification can be a Social Insurance Card or a valid credit card issued by a Canadian bank (for example, Royal Bank of Canada, CIBC, Scotiabank, TDCT, Bank of Montreal). Credit cards must be signed on the reverse. All original identification must be produced and photocopied by the lawyer or one of the staff members when you attend at their office for your appointment in order for your transaction to be completed.
On the day of closing your lawyer will:
- Update the title search and sheriff’s searches
- Obtain and review executed closing documents from the solicitor acting for the other party, as well as obtain the keys to the home.
- Electronically transfer funds to the other solicitor’s trust account.
- Upon deposit of all funds and receipt of the solicitor’s documentation, the closing will then be completed electronically in your lawyer’s office.
- Once the final registration has taken place you will be contacted by the law clerk assigned to your file. The law clerk will advise you when and where the keys will be available for pick up. Usually you will come to the lawyer’s office, but if you are purchasing from a builder, you would have to attend at the builder’s site office to pick up keys.
- As soon as you have the keys you can move in!
Approximately 4-6 weeks after closing, you will receive from your lawyer the Reporting Letter. This Letter is comprised of copies of the lawyer’s documentation you signed prior to closing and copies of the registered documents from closing. Your deed will be a part of this package. You should keep these documents in a safe place! A Reporting Letter is also sent to your financial institution to report on the registration of the mortgage.