Blog

  • Statements for Payouts – Why are you being asked for them and what you need to know.

    Statements for Payouts – Why are you being asked for them and what you need to know.

    What are Statements for Payouts?

    If you are refinancing your mortgage to pay out several debts such as credit cards, car loans, etc., you may be required to provide a recent (within the past week or two) statement for each debt to be paid out that shows the following information:

    • Your outstanding balance
    • The account number
    • Your name

    But I’ve already submitted these to my broker or lender, why are you asking for them again?

    Without question, it is frustrating to be asked for the same documents again and again.

    As a rule of thumb, your lawyer will try to use documents your broker and lender has shared with us.  However, there may be a lag of weeks and even months from the time you apply for your new mortgage until closing time.  

    Some statements may be out-of-date and show an incorrect balance as they may have been used or paid down as of late.  A statement within the past week or two provides a more accurate amount that is to be paid out to your creditor and will avoid additional interest and future hassles in paying off your debts.

    What’s the best way to get these statements?

    Most of your statements can be accessed online by logging into your creditor’s website.   Some website provide the option to download a statement, while some may require you to take a screen capture.  

    When you are saving or screen capturing your statements, please ensure your name, account number, and outstanding balances are clearly visible.  Otherwise, you may be asked to resubmit the statement.

    Why does the statement need to show the account number and my name specifically?

    Your lawyer is undertaking payment to your creditors and need to ensure we have the correct account numbers and are paying the correct party.  This is to avoid situations where payment is made to the wrong accounts or made fraudulently.

    Can’t you just do this for me?

    Unfortunately, privacy rules and regulations prevent lawyers from speaking to creditors on your behalf.  At Deeded, we understand that the process of obtaining statements is tedious and time-consuming and are working on various solutions to solve for it in the future.

    1
    Read more
  • What exactly is broom swept condition?

    What exactly is broom swept condition?

    If you are selling or buying a home, you may encounter a clause in your agreement that states that your property must be left in “broom swept” or “broom clean” condition.   What exactly does broom swept mean and why misinterpreting this condition can lead to legal arguments and bruised feelings?

    What is broom swept condition?

    Unless professional cleaning was included as a condition within the agreement of purchase and sale, the seller is typically expected to leave the property in what some in the industry refer to as “broom-swept condition”.  Broom swept or broom clean condition typically includes sweeping or vacuuming the floors, removing garbage, emptying cupboards, clearing closets and appliances (if included) and making sure that the property is free of any personal belongings (again, unless they were included).

    A common complaint from buyers when they take possession of a property is that sellers will leave their stuff behind.  From garbage bags to old paint cans, shampoo bottles in the shower, to old furniture, leaving personal belongings behind for a buyer to dispose of can quickly escalate to arguments and even legal ramifications between the buyer, seller, and their respective lawyers.

    Sometimes things are left behind with best intentions.  If you’re selling, you may think the buyer may want to keep something. However, thinking they may want to keep something doesn’t mean that the buyer actually does.  You should ask beforehand, so you know whether to leave it.  Otherwise, you’ll need to take it with you when you leave.

    For buyers, scheduling a walkthrough a few days before closing can also help identify any potential situations where stuff is left behind and allows for the opportunity to speak with the sellers to clarify what’s going and what’s staying.

    My seller left belongings and garbage behind.  What can I do?

    In the situation where your agreement states that the property shall be left in broom swept condition, but you unlock the door to find unexpected items or garbage left behind, document the situation by taking pictures and notify your Real Estate lawyer as soon as possible.  In most cases, your lawyer will communicate with the seller’s lawyer and request they rectify the situation and remove their belongings or compensate the buyer for removal costs.

    I’m the seller.  How should I leave my place?

    Regardless of whether it is in the agreement or not, leaving your place tidy for the buyer is a common courtesy.  No new owner wants to come into their new home to have to get rid of stuff left behind by others.    

    You don’t need to leave your place spotless and immaculate, but most definitely, pack all your personal items and dispose of items you are not taking with you in a proper manner prior to your move-out date.   Leave your property in clean condition, free of dirt, garbage and clutter.

    What if garbage is improperly left on the curb?

    Some sellers think it’s ok if they dispose their items by putting them on the curb and assuming it will be picked up by garbage collection.  

    Every municipality has different garbage collection schedules and may or may not accept some items for disposal.  Therefore, simply putting items on the curb is not a good solution for sellers unless you’re certain that these items will be picked up and are within the guidelines and limits of the municipality.  

    1
    Read more
  • Five tips for a quick closing to your mortgage refinance

    Five tips for a quick closing to your mortgage refinance

    If you are closing your mortgage refinance, you’ll likely be required to use a lawyer or a title company to close your new mortgage.

    Refinancing a mortgage means paying off an existing loan (mortgage) and replacing it with a new one.  In most scenarios, your new lender may be a different institution than the one that holds your current mortgage and part of the amount you borrow may be used to pay off your existing loan to your current lender.

    Closing mortgage refinance delays are not uncommon and are caused by a variety of factors.  There are, however, multiple things you can do to ensure your mortgage refinance closing happens seamlessly and on time.  Here are some of them:

    Have valid government photo ID

    Since the beginning of the pandemic, many Canadians have not had the opportunity to renew their drivers’ license or passports. 

    While there has been a grace period during the pandemic, a valid government-issued photo ID is required.  If you are planning to close on a property or a mortgage, an expired drivers’ license or passport will not be accepted.  

    Ensure you provide updated debt statements

    If you are refinancing to consolidate debt, your lender may require your lawyer or title company to pay off your debtors out of the proceeds of your refinance.  For your debtors to be paid and to avoid accumulating additional interest, you will likely be asked for the latest statements for each debt.

    If you’ve already provided these statements to your mortgage agent or bank, you may be wondering why you may need to resubmit them again.   Occasionally the mortgage application to approval process may take weeks.  If a statement is out-of-date, the balances to be paid may be incorrect.  Therefore, you may need to obtain statements again for the purpose of closing.

    Statements must contain key items such as your name, your account number, and your most recent balance to be processed.  Most statements can be obtained online through online banking or by calling the company.  It may be a tedious process, but the quicker you can obtain the statements, the quicker your refinance can close and the impact of consolidating debt takes effect.

    Provide your lender with lawyer’s information

    Your lender will require your lawyer’s information to send mortgage instruction to the lawyer’s office.  In most cases, this information will be required when you sign your new mortgage commitment.  Delaying providing your lawyer’s coordinates and contact information to your lender may delay your closing.

    Schedule closing off peak

    Real Estate and Mortgage transactions peak from April through September and because purchases and sales have a firm deadline, chances are your refinance closing may get delayed.  If possible, choosing a closing date in the beginning or the month will increase the chances of your mortgage refinance closing on time.

    Close virtually

    Virtual closing is now an option in most Canadian provinces.  Quite simply, it means that you can sign your closing documents from the comfort of your home, without having to go into a lawyer’s or notary’s office.  

    A virtual closing isn’t only a convenient option, but when it comes to accelerating the closing of your mortgage, it eliminates a lot of the back-and-forth scheduling and time constraints required to book an appointment.   When you use Deeded, our virtual closing experience can be completed in the evenings and even on weekends.

    1
    Read more
  • What is a trust agreement in Real Estate?

    What is a trust agreement in Real Estate?

    In most cases, the beneficial and legal owners of a property are one and the same, but they can be separate individuals through a “trust agreement”.  Simply put, a trust agreement is a legal tool to separate the legal and beneficial owners of the property.

    What are “legal owners”?

    The legal owners are the persons named in the deed/transfer when the property is transferred and registered with the land registry. If there is a mortgage taken out for the transaction, it would be under the legal owner’s name.

    What are “beneficial owners”?

    The beneficial owners are persons who receive the profits from the property, whether that be rents or funds from the sale of the property.

    Why separate legal and beneficial owners?

    On occasion, a property may have separate legal and beneficial owners.

    For example, a member of the family may want to ensure they are entitled to the proceeds of the property, but don’t want to be named in the mortgage. This can occur for various reasons. 

    Perhaps they don’t qualify for a mortgage, or their inclusion would lead to adverse effects with respect to the mortgage.  In other cases, an individual may want to ensure that their common-law partner would be entitled to the proceeds of a property he/she purchased prior to their relationship. 

    What are some important facts to consider with respect to a trust agreement? 

    A trust agreement can be drafted by a real estate lawyer, but on most occasions, you may need to retain a separate lawyer then the lawyer who handled your transaction.  Reason being is that most real estate lawyers who close your property transaction also represent the lender/bank in the transaction.  This can put the lawyer in conflict since a trust agreement may be detrimental to the lender’s claims to the property.

    A trust agreement does not override any family law statutory obligations. This means that if the legal owner is liable for any spousal/child support or any other family law obligations, they have the right-of-way to the proceeds of the property, no matter who the beneficial owner is.   

    Lastly is whether the property is jointly owned or through tenants-in-common. If the property is jointly owned, the trust agreement must be accepted and signed by all joint tenants. However if it is owned by tenants-in-common, an owner can form a trust agreement outlining the terms specifically for his/her share of the property.

    1
    Read more
  • Can you close your Alberta property from out-of-province?

    Can you close your Alberta property from out-of-province?

    Compared to Real Estate markets like Ontario and British Columbia who have seen overwhelming increases in home prices in recent years, Alberta’s Real Estate market remains relatively affordable for Canadians.  With a lower average home price, Alberta Real Estate also generates plenty of investment opportunities with positive cashflow and has become a popular destination amongst Real Estate investors.

    When it comes to closing your Alberta property, you’ll need to use an Alberta-licensed Real Estate Lawyer to close your transaction.  If you are out-of-province aren’t physically located in Alberta yet (perhaps you’re still in the process of moving or buying an investment property and reside in another province), your closing may either involve travelling to Alberta to sign your closing documents or hiring an additional lawyer or notary that is local to you, to witness the signing of your documents.

    Alberta saw more new residents and Real Estate investors in 2021 than any other province in the country.  If you are one of the many people who are considering relocating to Alberta or buying an Alberta investment property, here are some key things that you need to know about the closing process in Alberta and how our team at Deeded can make your Alberta property closing seamless and affordable.

    Both travelling to Alberta and hiring an additional lawyer can add to the costs, and complexity of closing your Alberta Real Estate transaction.  At Deeded, our virtual closing process helps you avoid both travel and the additional costs.   Here’s how it works:

    1. Initiate your closing by getting a quote through our website and uploading your Alberta purchase contract.
    2. Our friendly team will get in touch to explain the closing process and answer any questions you may have.
    3. An Alberta Real Estate Lawyer will work with you and your bank and/or mortgage broker to get your mortgage proceeds (if applicable).  You can seamlessly deposit your down payment funds into the lawyer’s trust account at any Canadian branch of TD bank.
    4. When it’s time to sign your closing documents, you’ll meet your Alberta Real Estate lawyer via secure video conference to sign your documents.
    5. Once your property is registered, they will arrange transfer of keys to you or your property manager.
    6. You can track the entire process through a user-friendly, personalized portal so you always know what’s next.

    What are the benefits of a virtual closing process for Alberta Real Estate?

    You’ll typically save time and money by not needing to travel to Alberta to sign your closing documents and avoid the additional costs of hiring an additional local lawyer to witness you signing your closing documents.   A virtual closing is secure, seamless, and efficient.

    Can you close properties in all cities within Alberta?

    Yes.  Whether your property is in Calgary, Edmonton, Medicine Hat, or anywhere else in Alberta, we can help you close.

    Do I physically need to be in Alberta to sign closing documents?

    No.  You can be anywhere in Canada.  All you need is a computer with a video camera and a reliable internet connection to attend your virtual signing appointment.

    I’ll be moving to Alberta.  Can you help me close my sale as well?

    Absolutely.  If your current property is anywhere in Ontario or British Columbia, we can help facilitate the closing of your sale, along with your Alberta purchase. 

    Can you help me refinance my Alberta investment property?

    We certainly can.  The same virtual process and benefits apply when you’re refinancing your Alberta property. Simply ask your lender or mortgage broker to use Deeded to close.

    Are there extra costs for this service?

    We certainly can.  The same virtual process and benefits apply when you’re refinancing your Alberta property.   Simply ask your lender or mortgage broker to use Deeded to close.

    How do I get started with closing?

    Simply click here to submit your information and purchase contract.

    1
    Read more
  • Does Alberta have a land transfer tax?

    Does Alberta have a land transfer tax?

    If you’re considering moving to Alberta or buying an Alberta investment property, the question if Alberta properties are subject to a land transfer tax (or property transfer tax as it may be called in some provinces), comes up quite often.

    Does Alberta have a land transfer tax? The short answer is no.  While most Canadian provinces levy a property or land transfer tax, Alberta requires only Land Transfer Registration Fees and Mortgage Registration Fees to be paid.

    The amount of these fees is much smaller when compared to other provinces.  Here’s a breakdown of the fees you can expect:

    • The Land Transfer Registration Fee costs a base of $50 and an additional $2 for every $5000 in property value.
    •  If you have a mortgage on your property, a Mortgage Registration Fee applies and costs a base of $50 and an additional $1.5 per $5000 on the mortgage amount.

    It's important to note that these fees and any legislation regarding land transfer taxes or applicable closing costs may change at any time. Always check with your lawyer or real estate professional prior to signing an agreement.

    For example, a $300,000 Alberta property with a $200,000 mortgage would cost:

    • Land transfer registration fees:  $170
    • Mortgage registration fees: $110

    These fees tend to be a small fraction of what a homebuyer could potentially pay for Land Transfer Taxes if buying a property in Ontario or British Columbia, making Alberta an attractive and cost-efficient place to purchase a property.

    If you’re purchasing or refinancing a property in Alberta, the Deeded team can help you close your transaction seamlessly with our virtual process.  You can sign your documents virtually from anywhere in Canada, saving you from having to travel to Alberta or retaining a second lawyer locally to witness your document signing.  

    Getting your Alberta closing process started is simple.  Click here to get started, upload your purchase contract, and we’ll get you on your way to owning your Alberta property.

    1
    Read more