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

    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.

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  • The Top Real Estate Closing Costs to Consider in Alberta

    The Top Real Estate Closing Costs to Consider in Alberta

    It is too often that we get clients who are closing the purchase or sale of their home in Alberta and are surprised to find out that they did not budget for all their real estate closing costs.

    Nothing is more stressful than finding out you have to scramble to come up with more money for your closing.   Nobody likes surprises.  That’s why we are always aiming to educate our clients and partners early in the home buying or selling process.

    If you are buying or selling a home in Alberta, here are some of the real estate closing costs you may encounter:

    Legal Fees

    In Alberta, you will need a lawyer to close your Real Estate transaction.  Legal fees can range from $800 - $1500 and can sometimes include or exclude disbursements (expenses incurred by the lawyer, which are typically passed on to you such as couriers, search costs or other fees).

    When comparing legal fees, ask for an estimate of total fees you can expect to pay for your closing, including disbursements.

    At Deeded, we offer a flat fee for closings and you can calculate your full real estate closing costs on our website. 

    Adjustment Fees

    Say you are buying a home, closing in July and the seller has prepaid their full property taxes for the full calendar year.   In this situation, your lawyer “adjusts” the taxes so that you (as the buyer in this example), would owe a pro-rated portion of the expense to the seller.

    Typical adjustments happen for property taxes, condo/strata fees, or any other fees that may have been pre-paid or unpaid by the buyer or seller.

    It is important to always budget for adjustments as they can increase your real estate closing costs.

    Land Titles Fees

    The cost of transferring land title in Alberta is set by the Land Titles Act and charged by the Alberta Land Titles Office.   It is paid for by the purchaser of the property on closing.

    This fee is calculated based on the value of the property and the mortgage funds borrowed and can be several hundreds of dollars.

    We offer a Land Titles calculator, along with calculating any other closing costs on our website.

    Real Property Report (RPR)

    A Real Property Report (RPR) is a legal document that clearly illustrates the location of significant visible improvements relative to property boundaries.  A seller will typically have to obtain an RPR as a condition of their sale.

    The amount of work (and cost) to prepare a Real Property Report varies between properties. Lot size and shape, number of buildings, natural features, age and availability of the property boundary information all affect the cost.

    Estoppel Certificate Fees

    You need this certificate to purchase a strata unit or a condominium in Alberta.  The estoppel certificate typically costs around $200 and shows you if outstanding interest is due from the previous owner, or if there are any unpaid condo contributions or interest that is due.

    Title Insurance

    Title insurance protects you from unknown title defects (title issues that prevent you from having clear ownership of the property).  For example, existing liens against the property’s title , encroachment issues (e.g. a structure on your property needs to be removed because it is on your neighbour’s property), and Title fraud.

    Title insurance is often recommended, but is optional. The cost of a title insurance policy in Alberta can range from $200 and up, depending on the value of your property and could be a worthwhile investment for peace of mind.

    Property Insurance

    If you are borrowing money for your home, your lender will typically require that you have a certain level of insurance coverage on your home and ask for proof of insurance (also known as an insurance binder), prior to closing. Without insurance, a lender will typically not advance the mortgage funds to the lawyer.

    It is a good idea to call your insurance broker and shop around a few weeks prior to closing.

    Finally, it is important to mention that your fees can vary depending on the property, location and situation. Contact the Deeded team and we’d be happy to give you a more accurate estimate.

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