The Buyers Lawyer

In Canada, the closing is handled by a real estate lawyer.

What does your lawyer do?

Once all the conditions in your offer have been fulfilled or "waived" (removed from the contract), the lawyer you have chosen and to whom you have asked your Realtor to send the documents, will proceed with the following:

Title Search A search of the title to the property to determine that the property is free & clear of any mortgages or other liens or unsatisfied judgments that you have not agreed to assume under your Agreement of Purchase & Sale.

Municipal Searches

Various searches through several departments of the municipality to determine the status of zoning, taxes, subdivision/development agreements, unregistered easements, and the possible existence of any outstanding work orders and other matters which may prove significant

A Building Location Survey Review

This educated examination of a current property survey (A necessary requirement for a lender unless title insurance is used) reveals any encroachments, which are any intrusions of other properties onto the subject property, or any intrusions of the subject property onto adjoining properties. It must also be checked to determine compliance with applicable zoning bylaws. An updated survey may be necessary and a new survey by an Ontario Land Surveyor can cost $900.00 or more.                 

Title Insurance

Why Title Insurance? This less-costly alternative to paying for a new survey (accepted by most financial institutions in lieu of a survey) is arranged and paid then charged in your billing statement. Title insurance protects against loss resulting from title defects which would have been revealed in an up to date survey or real property report as well as loss resulting from fraud and forgery. If title insurance is ordered, it is often not necessary to order many of the municipal searches.

Letter of Requisition

Certain detailed relevant information is needed from the other parties' lawyer and must be requested before the date spelled out on the agreement of purchase and sale. Communication with the other solicitor continues up to and including the closing date. 

Draft a New Mortgage

The Lender will give instructions to place a mortgage on the property in exchange for cash which will be given to the sellers lawyer. All details are not finalized (amount, rate and insurance) until about one week before the closing date.  

Verify Insurance

Because all lenders (mortgagees) require that the property is insured against all perils to protect their interests, this coverage must be confirmed before any money is advanced.

Tax Account  

Taxes and any appliance rental payments must be adjusted & allocated to the correct party for the day of closing. 

Land Transfer Tax

Every purchase of real estate is subject to this tax and is charged to you on your billing statement.

Statement of Adjustments

The Sellers' lawyer prepares this accounting of the sale. It reflects credits given to the Buyer or Seller regarding such details as the deposit, municipal taxes and the balance of any mortgage to be assumed, and in the case of income properties, any rents & rental deposits. This statement is usually ready a few days ahead of closing so that a certified cheque may be prepared & submitted along with the funds from any mortgage.

Execution & Endorsement of Documents

An appointment for clients to sign all pertinent paperwork like mortgages and legal declarations is arranged for a day or so before closing and all funds are received and put in trust.

Closing the Transaction

On the day of closing, the funds are given to the sellers' solicitor in exchange for the keys to the property and the deed is transferred to the new owners. The transaction is complete.

Reporting and Accounting

A letter containing the lawyers bill, details of accounting and moneys held in trust will be sent to the client along with any deed or discharges within a few weeks after closing.     

These functions are what are covered by the lawyers fee. There are, however, other costs which must be paid on your behalf, as seen below, which the lawyer will itemize on your statement of adjustments to receive reimbursement.