Admin, Author at Deeded

01 November 2021

We’ve all heard of buyer’s remorse. But what if a seller won’t close?

Finally. You signed an agreement last night to buy your dream home. You’re so excited that you can’t sleep. You think about all those other homes you saw and lost out on. All the bidding wars you’ve lost, and the emotional rollercoaster you went through.

At last, your dream home is within reach. You drop off your deposit the next day and start making a massive “to-do” list to prepare for your move.

Suddenly a call comes in from your lawyer. Your seller refuses to close. As you try to grasp what just happened and wait for someone to pinch you so you can wake up from this nightmare, reality sinks in.

Although most real estate transactions do close, there’s always a small percentage that may fall through. More common are situations where the buyer can’t or won’t close. Although this may happen for various reasons, in most cases, it is more likely that the buyer experiences remorse on their purchase and tries to back out of the deal.

But what if a seller won’t close or experiences seller’s remorse? This situation is becoming more common as the home prices continue to appreciate and a seller starts pondering if they’ve left too much money on “the table”.

For example, John agreed to sell his house to Martha for $500K. Both parties signed a binding agreement to close the transaction within 60 days. Two weeks later, John’s neighbour, who has a very similar property puts their house on the market and ends up selling for $600K. John starts feeling that he has missed out on the opportunity to get an additional $100K for his home. This is commonly called seller’s remorse. Seller’s remorse can be for a variety of other reasons such as sentimental value, or others. After all, selling your home is a highly emotional experience.

So parties can have remorse. What does it mean for the transaction?

A firm agreement of purchase and sale is a binding contract. When a seller won’t close or does not complete an agreement without cause the seller can be responsible for making the buyer “whole”.

This means that the buyer is entitled to be put in the same position as they would have been had the seller completed the transaction as promised and scheduled.

So, continuing with our example above, if John ends up backing out of the agreement to sell his house for $500K and Martha now has to buy another home and paid $600K due to the appreciating market conditions, John, as the seller may be liable to his Martha for the difference between the original contract price and the price that Martha will ultimately buy a comparable the home for, plus any related costs incurred by the buyer, such as legal, carrying, moving or accommodation costs etc.

As a buyer, your damages must be reasonable and foreseeable and you must do your best to mitigate the amount of damages suffered (so staying at Four Seasons while you’re shopping for a new home, is not your best option).

As soon as you sense the seller won’t close, speak to your lawyer and Realtor to discuss your options as there may still be a way to get the deal done.

Since every situation is different, you should, first-and-foremost, consult a lawyer to seek proper legal advice and understand your rights and remedies. It’s best to do so at the earliest sign of issues. Your lawyer and Realtor can also help establish a line of communications with the seller, while removing the emotional aspects out of the equation. In many situations expensive litigation can be avoided by understanding the interests of both sides and figuring out a way to move forward.

If all sides are cooperating, then there is a good chance you might be able to reach a compromise solving the issue quickly and getting you into your new home.

But I Put Down a Deposit, What Happens To it?

If a seller backs out and decides to breach the agreement, you are generally entitled to a return of your deposit upon either signing a mutual release or a court order.

A mutual release is a document used in real estate when a deal falls through. It releases both parties from the Agreement of Purchase and Sale. The buyer gets their deposit back and the seller is free to sell their house to someone else or hang onto it. It also means that both the buyer and seller release each other from any future liabilities or damages.

As a buyer, while it may be tempting to just get you deposit back and move on, it is wise to seek legal advice prior to signing a release to understand your options.

If you have any further questions, rest assured that the Deeded team is here to support you in any way we can.

Important Note: This article is not Legal Advice. No one should act, or refrain from acting, based solely upon the materials provided on this website, any hypertext links or other general information without first seeking appropriate legal or other professional advice.

26 July 2021

Behind the scenes: What happens on closing day

One of the biggest questions during a Real Estate transaction is “when do we get our keys?”

Before getting your keys, there are several steps that need to be completed first and this all (believe it or not) happens behind the scenes on closing day.

What is Closing Day

Closing day is the day when you take legal possession and finally get to call your new house your home. Prior to closing day, the buyer will be signing and reviewing documents prepared by the lawyer with regards to their mortgage loan, down payment, closing costs & purchase price. They will also review a statement of adjustments, which outlines the final closing numbers. Lastly, the buyers must arrange for funds to be deposited in the lawyer’s trust account, while the lawyer requests the remaining funds from the mortgage lender. The funds are then transferred to the seller’s lawyer who releases the property to be registered in the buyer’s name, along with a mortgage (also called charge) which will be registered in the favour of the lender.

When Should You Schedule Your Closing Day?

Picking a closing day may seem like a simple decision, however there are many factors to keep in mind to avoid major issues from arising. Picking a closing on a Friday may cause issues if you cannot get everything before 5:00pm, businesses and systems will close for the weekend leaving you unable to close which may cause you to pay extra costs. The same principal is recommended for avoiding closing days before long weekends.

In addition, you should also keep in mind, Real Estate transactions peak in month-end especially during the Spring. Be aware this means everything, and everyone will be busier, such as movers, lawyers, realtors, and lenders. Therefore, it may be more difficult to ensure all parties are available and able to attend your closing. Overall, it is recommended to avoid picking a closing day before Fridays, long weekends, and month-ends wherever possible.

What Happens on or near Closing Day?

On the actual day of closing there are a number of tasks that must be completed by each party before the keys can change hands.

• The buyer will sign a variety of documents prepared by their lawyer relating to the mortgage loan, and the purchase of the home.
• Your lender will send the mortgage funds to your lawyer.
• You must provide the rest of the purchase price to your lawyer as well as the additional closing costs.
• Your lawyer transfers the funds to the seller’s lawyer.
• Your lawyer will register the property in your name with the Land Title / Land Registry Office. If applicable, they will also register a mortgage (also commonly referred to as “charge”) in favour of your lender.
• You will receive a closing report, which includes a copy of the deed/transfer of title.
• Your Lawyer will provide instructions on how and where you can get your keys. At Deeded, we will typically arrange for lockbox so you can easily access your new property.
• Additionally, please make sure you contact all appropriate utilities to inform them you are the new owner (i.e., hydro, electricity, water, condo fees, taxes etc.) so they can update their billing information.

As you can see, there’s a whole lot that happens on or near your closing day, with most steps happening behind the scenes. The goal is to have all these tasks completed by 4pm to 5pm which is when many agencies and lenders close for the day. If the deadline isn’t met, the closing is typically extended to the next business day. Hence closing on a Friday or before a holiday weekend is not recommended.

Additional Closing Costs

• Your Deposit– The deposit is a portion of the total home purchase price that will be paid out-of-pocket by the buyer. Typically, the down payment is between 5-20% of the total purchase price.
• Land Transfer Taxes (LTT) – The LTT is calculated as a percentage of the purchase price of your home. The exact percentage varies from province to province and sometimes individual municipalities like Toronto have additional costs. Alberta does not have LTT.
CMHC Insurance – Should you use less than 20% for your down payment, you will be required to obtain CMHC insurance. This is an insurance policy that protects your lender should your borrower default on your loan repayment.

This is not an exhaustive list, visit this blog for additional information on closing costs, however we always recommended speaking to your realtor and lawyer to ensure you know exactly what your circumstances will be at closing.

Can Deeded Help with My Closing?

Of Course! When it comes to purchasing a home, our team at Deeded strives to make the process as easy as possible so you can “close” and get your keys as quick as possible.

Our team helps you understand your obligations, help you navigate the legal documents that need to be signed before funds are released to you and can expedite the closing process, all to ensure you have a fantastic closing experience. Please feel free to contact us anytime.

Final Thoughts

The closing process is a complicated and high-stress event, not just for the buyers and sellers but the realtors, lawyers, and lenders as well. Although it is understandable that you want the closing process to be done as quickly as possible, being patient will help things go much more smoothly.

If you have any further questions our experienced team is ready and able to make your closing a simple, quick, and painless process. Feel free to contact our team if you have any questions on our closing procedure, and to obtain a quote, please click here.

26 July 2021

Five most common title transfer issues

A title is a legal term that means registered owner of a property. A title transfer is assigning ownership, or part of the ownership to another party.

When purchasing a property, the title must be transferred from the seller to the new owner. However, it is not always as simple as signing a document, a large number of properties may require work to “clean up” issues with a title.

Here is a list of the five most common issues:

Property has a Lien

If any of the previous title holders had outstanding debt, such as unpaid property taxes, general contractor bills, or a judgement from the court to pay off a creditor, those companies may have placed a lien on the property.

A property lien is a legal claim on assets that allows the holder to obtain rights to the property if debts are not paid. If there is a lien on the property you are purchasing, you may inherited it upon closing.

This is an example of a very common issue that can be resolved by your lawyer on closing. Using a title search will identify if there is a lien on the property and you can work with your lawyer to address and resolve the issue.

Boundary Disputes

If you will not be getting a survey on your potential property before closing from the sellers you run the risk of having a boundary dispute with neighbouring properties. A boundary dispute is somewhat common and the only way to resolve this issue is through an up-to-date survey on the property.

Your Real Estate lawyer may recommend a property survey if there is evidence to suggest it would be beneficial. However, this is quite often not the case, few closings include property surveys because of the cost and length of time it takes to complete. Without taking proper protection, this potential issue could be a serious financial burden to resolve.

This is a case where title insurance is a great option to mitigate some of the unknowns and protect future interests in the property.

Illegal Past Deeds and Fraud

There are a number of illegal actions that may impact the sale of a property and the transfer of a title in the future. That could include deeds made by minors, people lying about their marital status, an undocumented immigrant. Illegal past deeds such as this may pose an issue to the transfer of a title and cost significant amounts to rectify.

In addition to the above illegal actions, fraud is another potential issue that may impact title transfers but is much more difficult to identify. When a lawyer conducts a title search you can identify anything that can be searchable through public documents and registrations. However, fraud is often undetectable through these available documents making it one of the most difficult of these common issues to protect against.

Undiscovered Encumbrances

When you purchased the property, you may not have been aware that a third-party may hold claim to part or all of the property from a previous event such as a lien. This may limit what you as the owner will be able to do with the property. These limits are known as encumbrances and are placed on the property itself, not the owner.

A real estate lawyer for title transfer will help discover if the property in question has unknown encumbrances. Some encumbrances are welcomed by owners, such as zoning laws that restrict properties in an area from being used for commercial purposes. Others can be more troublesome, like liens placed on a property that seek repayment of debt.

Almost all property, particularly in densely populated areas, is encumbered in one way or another. That is why it is important to have a knowledgeable real estate lawyer by you side when learning if there are encumbrances on a property

Public Record Errors

Whether it be adding an extra zero or misfiling a document, public record errors do happen. Unfortunately, when filing and clerical errors occur, they are often difficult to detect or notice because sometimes they blend in easily. Dealing with public record errors can cause serious financial stress on the title owner and be very time consuming to rectify.

How Can I Protect Myself?

Throughout this article we’ve listed all issues that may arise from a title transfer and likely caused you lots of anxiety. You’re probably wondering now, what can I do to protect myself from all these problems. The answer is simple, get title insurance.

While every policy is different and we recommend checking your specific policy for the details, but in general, title insurance will cover you for all of the above title-related issues and more that can affect your ability to sell, mortgage, or lease your property in the future, or its value.

Final Thoughts

When conducting a title transfer on a property it’s wise to use an experienced real estate lawyer that can help you ensure you have proper protection and don’t ignore any serious issues. If you have any further questions, rest assured that the Deeded team is here to support you in any way we can.

Send us an email and we would be happy to answer any questions you have or provide recommendations for your situation.

18 June 2021

Independent Legal Advice (ILA) and when you may need it.

There are certain situations when purchasing or selling a property or refinancing your mortgage, where one or more of the parties to the transaction will require independent legal advice (ILA).

ILA is the process where an outside, unbiased lawyer is retained by one party for the limited purpose of providing advice on the real estate transaction so the individual appreciates the nature and consequences of a decision that must be made.

Key Takeaways:

• Under certain situations such as conflict of interest of joint retainers, you may be required to obtain independent legal advice. Your mortgage lender may also require ILA to qualify you for a loan.

• ILA will help ensure you understand all legal aspects of the closing and any agreements or contracts you sign and will also provide you with a certificate upon completion.

When Would I Need ILA?

According to the Ontario lawyer’s rules of professional conduct, you would be required to obtain Independent Legal Advice (ILA) under several circumstances.

• When there is a potential conflict of interest, a lawyer may still be permitted to act for a client but will be required to advise the client to seek independent legal advice. This is to enable the client to fully understand the implications of a conflict of interest.

• A joint retainer occurs when two or more people hire the same lawyer to represent them for a shared purpose, such as a real estate transaction. In this scenario, lawyers are advised to recommend that their clients seek independent legal advice.

• If a lawyer finds out that they have made an error or an omission that could be damaging to the client’s case, the client should be advised to seek independent legal advice.

Should you decide not to obtain ILA during a real estate transaction, there may be consequences. For example, the contract that you sign may not be legally enforceable should the courts deem that you were not properly informed. In addition, certain mortgage lenders may require you to obtain some form of ILA in order to qualify for your loan. Be sure you understand your circumstances before you make a decision.

What Will Happen When I Get ILA?

When you seek independent legal advice, you will meet with a lawyer who will confirm that you fully understand all legal aspects of your transactions. Including benefits, liabilities and any legal ‘jargon’ they may not fully understand. At Deeded, our lawyers can provide an ILA using our virtual technology, meaning you won’t have to come into the office. Instead, you’ll meet the lawyer over a secure video conference.

When looking for a lawyer to provide you with legal advice, you should ensure they offer the following services:

• Review your purchase/sale agreement and all other legal documents and attachments.
• Provide consultation and advice for agreement and all other legal documents.
• Provide you with an independent legal advice certificate upon completion of their services.
• If you are seeking convenience, will the lawyer provide an ILA over a video conference or other remote technologies?

When do Lenders Require ILA?

In many situations it may be the mortgage lender that will require persons to obtain ILA in order to qualify for the loan. ILA is typically required to be obtained by the legal titleholder of the property. This is meant to ensure that they receive a simple explanation of the nature and obligations contained in their mortgage agreement from an impartial third-party lawyer.

In addition to the title-holder, lenders may require non-title holding spouses or other individuals involved in the transaction such as a guarantor or covenantor, to receive ILA as well. This is to ensure that they also receive an explanation of their obligations as they may become liable for repayment of the mortgage loan and observance of the mortgage obligations under certain circumstances, such as the death of the title-holder.

In most circumstances, the requirements from the lender on who will need to obtain ILA will be set out before-hand in the mortgage commitment. If it’s not, we would recommend taking the initiative to bring this up with the lender, whatever the result is make sure you take clear written instructions in case you ever need to refer back.

If this looks overwhelming to you, rest assured that the Deeded team is here to make things easier and as simple as possible. We will walk you through your situation and help you understand what requirements you have and what steps you need to take to protect yourself and ensure that you understand every aspect of your transaction.

16 June 2021

Should I Be Drafting My Own Agreement of Purchase and Sale?

Some homeowners or home buyers have contemplated at some point whether they should be buying or selling their home without the help of a Real Estate agent, or privately as it is commonly referred to.

We are not going to debate the reasons for and against buying or selling privately. We believe that Buyers and Sellers need to understand the pros and cons of using certain professionals in their transaction, and ultimately, it is entirely up to the individual Buyer or Seller to decide what resources they may or may not want to use for their purchase and sale.

What we have seen lately is Buyers and Sellers who are completing their transactions privately and are drafting their own agreement of purchase and sale; occasionally using templates and forms from the Real Estate boards and associations, or the similar forms to what Real Estate agents are using.

There is one positive aspect about using templates and drafting your own Agreement of Purchase and Sale in order to negotiate your private transaction and that is, it is better than a hand-shake after all. When an Agreement is signed by both parties and consideration is provided, it becomes binding. Which means all parties are now obligated to fulfill the terms and conditions of the said Agreement.

While the “do it yourself” (DIY) drafting of a contract method may work for purchasing a used car or some simple low-cost items, a home is one of the largest purchases you will ever make. A mistake or an issue with an Agreement can end up costing you a significant amount should things not play out the way you have expected them to.

That is why it is almost critical to have your Agreement reviewed by a lawyer prior to signing. No matter how simple or straightforward you may believe the Agreement to be. We have seen DIY Agreements that missed inclusions of appliances (imagine moving into your new home only to discover the seller took all their appliances while you were assuming they were included). All the way to incorrectly describing the property or land. Ultimately, minor mistakes can become costly in the end.

But I’m Using the Same Forms Real Estate Agents Do, What Can Go Wrong?

On a practical level, Real Estate forms are the standard way to contract for a Real Estate Purchase or Sale. However, there are issues right off the bat with using real estate templates.

First, most forms are copyrighted and licensed by the Real Estate boards or brokerages. For example, in Ontario, OREA licenses its forms to their members and the OREA purchase and sale form is used as a standard by Real Estate agents across Ontario.

Even though they are readily available by doing a simple Google search, you may be infringing on copyright or licensing agreements if you are not licensed to use the forms. Second, forms that are found online may be outdated or may have been modified, sometimes in undetectable ways.

The other thing to keep in mind is that Real Estate agents are licensed, regulated and insured. When a Real Estate Agent writes up an Agreement, they have been trained to do so through their licensing process, by their brokerage, or through experience of putting together many Agreements.

They are also insured by an errors and omissions policy. Say your agent made a mistake on the Agreement, which caused you financial damages. Your agent (or their insurer), would be responsible for any claims and settlements.

When it is you who writes the Agreement, no matter if it is on a Real Estate form, you are not insured. Therefore, any claims for a mistake you may make, must be paid out of pocket.

Can I put the Agreement Together and Have a Lawyer Review?

Yes you can, an experienced Real Estate lawyer works with Agreements of Purchase and Sale on a frequent basis and has the experience to spot any potential issues. A lawyer can either review an Agreement you have put together prior to signing, or offer to draft an Agreement for you from scratch.

How Much Will it Cost to Review an Agreement?

It is probably less than you think. Especially if considering the peace of mind and potential risks you may be taking. At Deeded, we would be happy to help review and/or draft your Agreement and provide you with a quick turnaround.

14 June 2021

I Received the Previous Owner’s Bill. What Should I Do?

You’ve spent the first month living in your new home and you couldn’t be happier.

However, when you go to check the mail, you notice a most unwelcome surprise. The city indicates there is an amount owing from the previous owner’s bill.

Your first thought might be malicious intent on the side of the seller, them trying to get away without properly taking care of their bills. However, chances are that this is probably not the case. The most likely scenario is that the previous owner’s bill was never sent to them, or, on occasion, the municipality did not process the change of ownership in a timely manner.

Commonly, bills such as water and property taxes are connected with the property, while utilities such as hydro and natural gas are associated with the consumer. Therefore, while a title changes ownership, water and property taxes continue to accumulate charges to the account associated with the property even as the owner’s name is changed on the accounts. This common mistake sometimes leaves the new homeowner with the leftover bill of the seller.

If you find yourself in the situation of having to deal with a previous owner’s bill, worry not, below we’ve outlined the exact steps you should take to resolve things.

Key Takeaways:

• Water bills and property taxes are associated with a property instead of a customer like utilities. This means you will sometimes see arrears on your water bills and property taxes from previous property owners.

• To deal with an arrears on your water bill contact your lawyer and have them contact the seller to request payment.

• Dealing with property tax arrears are more common on new homes and require your lawyer to contact the builder’s lawyer to adjust.

• While arrears on your bill are a common post-closing issue and are often easy to solve, it is an excellent example of the benefits of title insurance.

What Should You Do with Arrears on Your Water Bill?

If you notice that there are arrears on your water bill from a previous property owner, the first thing you should do is contact your real estate lawyer and provide them a copy of the bill. Your lawyer will then contact the seller’s lawyer, who will then contact the seller directly to request payment of the bill.

If you do not receive a reply from the seller you are left with two options. If you have title insurance, you may submit a claim to your insurer. If you already paid the bill, the title insurer will reimburse you directly. If you did not pay the bill, the title insurer will pay the bill on your behalf. However, if you do not have title insurance, your choices would be to either take the seller to court which would be costly and time consuming, or pay off the bill yourself.

What Should You Do with Arrears on Your Property Taxes?

Property tax arrears on existing homes are rarely an issue after closing because they are known and adjusted at closing. However, if they are discovered, contacting your lawyer and following a similar format as you would for the above water bill situation is the best scenario.

However, if the property you are purchasing is a new home, then it is likely that the property taxes need to be adjusted with the builder after closing. It typically takes several months for a new property to be assessed. Once that happens, the new owner will receive a supplementary property tax bill.

When you receive your supplementary property tax bill, we recommend you contact your lawyer to ensure everything is in order before contacting the builder’s lawyer to properly adjust the bill between the parties.

More often than not, the builder will pay their portion of the bill to the new owners to reimburse them for paying the entire bill. Each builder has different policies in adjusting for property taxes therefore it is usually best to leave discussions up to your lawyer when getting reimbursed.

Final Thoughts

Adjusting after closing for arrears on your bills is often a common post-closing situation and most of the times can be resolved fairly quickly.

If all sides are cooperating, then the adjustment can be taken care of quickly and seamlessly. However, it’s recommended you always consult with an expert when dealing with these issues to avoid any mishaps. If you have any further questions, rest assured that the Deeded team is here to support you in any way we can.

08 June 2021

Conditions On An Offer: Why They Matter

Purchasing a home has a great deal of inherent risk, that is why sometimes buyers and sellers look to mitigate that risk by using certain protections when making an offer. That is where conditions on an offer to purchase come in.

When a buyer’s offer is accepted by a seller, both parties are entered into the contract. However, when making an offer, either party has the choice to make the agreement contingent on certain factors.

These criteria, or conditions, are clauses that would void or alter the purchase/sales contract if certain obligations are not met. These obligations can typically fall under three major categories: home inspection, mortgage approval, and lawyer’s review of the agreement.

Mortgage or Financing Condition

It is common sense not to purchase something that you don’t have the money to pay for, that’s exactly the purpose of a mortgage or a financing condition in your offer. The financing condition clause protects the buyer in the case they are not able to secure a loan.

This clause allows the buyer a predetermined period of time (usually 3-5 business days) to secure a lender that will issue a mortgage after the date the offer is accepted. If the buyer is unable to secure a lender that will commit to a loan, the buyer may invoke this clause of the agreement and walk away from the sale with the down payment and no other penalties.

It is always a good idea to get pre-approved by a mortgage lender prior to putting in an offer. This process will give you a better idea of what you can afford and what the lender is willing to lend you. Although the clause may allow you, as the buyer, to walk away from the transaction, it is always a good idea to have your mortgage lined up.

Home Inspection

A home inspection is one of the most important clauses to include in a closing agreement. This contingency allows the buyer to have a third-party inspect the property after putting down a deposit.

The purpose of this condition is to ensure that there are no issues with the property such as damage. However, if something does appear to be wrong, a home inspection contingency allows the buyer several options. They may either request that it be fixed at the sellers’ expense, renegotiate the price to factor in costs of the repairs they would have to pay or ultimately back out of the sale. It’s rarely advisable to waive an inspection contingency, for more information of why home inspections are a must have, visit this blog.

Lawyer’s Review Condition

Before entering a binding agreement that may involve a very significant purchase such as a home, it is always wise to have the agreement reviewed by a lawyer.

There have been many cases where both buyers and sellers did not understand their obligations under a binding agreement of purchase and sale. Some of these cases have resulted in litigation and heavy financial judgements against buyers or sellers. Having a lawyer review clause in your agreement will allow for a few days to have the agreement properly reviewed, giving you peace of mind.

Waiving All Conditions in a “Hot Market”

The Real Estate market has been highly competitive across North America for the past few years with properties often receiving multiple offers and bids in attempts to purchase the property.

As a buyer, it is ultimately your decision whether you would like to waive or forego any certain conditions in order to make your offer more attractive to the sellers. For example, a seller would typically see an offer with no conditions more attractive than an offer with certain conditions.

Quite simply, it gives sellers more certainty as opposed to having to wait days for all conditions to be satisfied and risking having to re-list their property should the deal fall apart.

While removing conditions may increase your chances of securing the property, it comes with taking on additional risks. For example, if you agree to purchase a property without an inspection and find out there are damages and issues after the fact, those issues become your responsibility.

Final Thoughts

When making an offer on a home it’s wise to use an experienced Realtor that can help you ensure you have proper protection. If you have any further questions, rest assured that the Deeded team is here to support you in any way we can. Send us an email and we would be happy to answer any questions you have or provide recommendations to suit your situation.

21 April 2021

3 Questions You Need to Ask Your Alberta Real Estate Lawyer

If you just firmed up your purchase or sale (Congratulations!), you’ll likely need to choose a Alberta Real Estate lawyer to facilitate your closing.

No matter which lawyer you choose, asking the right questions before moving forward with having the lawyer (or law firm) who is going to handle your transaction can make the entire experience smoother and more predictable.

Here are some questions you must ask any Alberta Real Estate lawyer when buying or selling a house:

What Are the Fees, INCLUDING Disbursements?

Legal fees are the professional fees your lawyer charges for completing your real estate transaction. In addition to legal fees, disbursements are third-party costs paid by your lawyer in connection with completing your transaction. Disbursements usually include costs such as land title fees, tax searches, title insurance, and courier costs.

Can I Sign My Documents Virtually and How Do You Conduct Your Virtual Meetings?

An Alberta Real Estate lawyer can now witness real estate closing documents remotely. This means you can meet with your lawyer through video-conferencing to have your closing documents signed and witnessed. However, not all lawyers conduct virtual signing meetings in the same manner.

At Deeded, virtual signings are easy, efficient and client friendly. Our lawyers can remotely witness Alberta real estate closing documents regardless of where you are located, either inside or outside of Alberta. All you need is a computer or tablet with a webcam, an internet connection, and a mobile phone.

What is Your Process?

Home buying/selling is exciting but can also be one of the most stressful experiences of your life. Whoever you choose needs to be able to explain the closing process so that you can anticipate what is required and know what to expect.

At Deeded, our goal is to make the process as smooth and seamless as possible. Our welcome package provides you with everything you need to know about the home closing process. Further, at every stage of the transaction, we will let you know what’s happening next. If you have any questions during the process, please do not hesitate to call, email or text us.

07 April 2021

What’s The ideal Day To Close your Real Estate Transaction?

When you’re making an offer to purchase a property, you’ll be asked when you would like to “close” on your property as part of the agreement to purchase. The date you pick will also have to align with your seller’s expectations as they may need to arrange to move and vacate the property.

On closing day, the ownership of the property is transferred to you, the buyer, and in most provinces, you will receive the keys to your property towards the end of the day.

While typically any business day can be designated as your closing day, it is important to consider a few factors that may make your closing experience easier and avoid potential issues when picking the ideal day to close your real estate transaction.

Key Takeaways:

• Picking a closing on a Friday may cause issues if you cannot get everything before 5:00pm, businesses and systems will close for the weekend leaving you stuck.
• Real Estate transaction peak in month-end especially during the Spring, be aware this means everything will be busier making it harder for you to get things done.
• When picking a closing day, try to avoid Fridays, long weekends, and month-ends wherever possible.

Here are a few of our suggestions when you’re picking the ideal day to close your real estate transaction:

Avoid Fridays, if You Can

While a Friday might sound like the ideal day of the week to close on a purchase. Friday closings can be the cause of major challenges and extra costs should something not go according to plan.

That’s because mortgage lenders and the electronic land registry are open until 5pm on Friday afternoon. After 5pm, registration and transfers of funds, if needed, become impossible until the following Monday.

During the day of closing a lot goes on behind the scenes and timelines can be very tight. Funds move between the buyer, the buyer’s lender and the seller and their lender (and their respective lawyers). After the funds arrive, the transaction needs to get registered before keys can be released to the buyer.

Needless to say, even the slightest delay or something not going according to plan can mean the difference between meeting the 5pm registration deadline or missing it. If the 5pm deadline for registration is missed for whatever reason, your transaction will likely not close till the next business day, which is Monday.

Depending on your circumstances, such delays can be costly and put a wrench in your moving plans, so if you can potentially avoid a Friday closing date, you may just eliminate a few potential headaches and hassles.

Before a long weekend or holiday?

We love our long weekends and while it may seem like the ideal time to close and settle into your new home, a long weekend can present the same challenges of closing on a Friday.

With mortgage lenders and the land registry closed for the long weekend or upcoming holiday, any delays in closing may result in having to wait until the next business day to close.

Month-end, Especially in the Spring

The volume of Real Estate transactions peak during the months of May through to September.

This means that law firms, movers, appraisers, and many other parties involved in your transaction get particularly busy these months, and particularly on the last few days of the month.

Closing at month-end isn’t an issue. In fact, it’s quite common.

However, with an increased volume of transactions and all the players in the system working to hit month-end deadlines, the chances of something slipping through the cracks will likely increase. It also means you may not always get your first choice of lawyer, mover, etc., especially as Covid continue to slow down and change processes in the industry.

Final Thoughts

When negotiating your closing, the ideal day to close your real estate transaction would be before Friday, prior to a long weekend and not on a month-end.

While your transaction may close without a hitch, even if on a Friday or the end of the month, picking the right closing date can decrease the chances of having closing issues.

06 April 2021

Practical Tips on Drafting Title Insurance Clauses in Alberta

When it comes to closing a home in Alberta, on occasion, the seller may offer a credit for the costs to the buyer to purchase a title insurance policy in lieu of the seller providing an up-to-date real property report (RPR). When considering the prospect of drafting title insurance clauses, into your agreement of purchase and sale make sure you understand exactly what you’re agreeing to.

What is Title Insurance

Title insurance is available for a low premium that is paid only once at the time of the purchase. Title insurance provides coverage for losses arising from survey/RPR related matters including:

• Forced removal by a governmental authority or an affected neighbour/easement holder of all or part of the existing structures due to encroachments onto adjoining land or onto an easement; and

• The land being unmarketable, which allows another person to refuse to perform a contract to purchase, lease or make a mortgage loan due to adverse matters that would have been disclosed by an up-to-date survey/RPR.

Limitations of Title Insurance

Title insurance does not cover known defects at the time of the purchase. This would include deficiencies disclosed in an RPR or home inspection report obtained prior to closing. However, some title insurers may provide coverage for known issues subject to underwriting approval. If you wish to use title insurance to deal with known issues, the availability and extent of coverage must be confirmed with the insurer prior to offering a title insurance credit to the buyer to compensate for the known issue.

Do be cautious in drafting title insurance clauses in the purchase agreement. Avoid vague clauses such as:

• Buyer accepts the RPR as-is with title insurance

• Title insurance in lieu of RPR

Clauses such as these do not address
- a) who pays for the title insurance; or
- b) what happens if the RPR shows a known defect which a title insurer will not cover.

At Deeded, we would be happy to help you draft title insurance clauses and would welcome the opportunity to collaborate with you on the purchase agreement to ensure the best interests of your client.

So parties can have remorse. What does it mean for the transaction?

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