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Tag: legal fees

  • Real Estate Legal Documents – What You’ll Need to Sign at Closing

    Real Estate Legal Documents – What You’ll Need to Sign at Closing

    Before your transaction closes, you'll meet with your Real Estate Lawyer at a signing appointment to review and sign your closing real estate legal documents. This is the time when you'll sign the required documents to make your purchase, sale or refinance transaction official.

    The excitement of getting to the finish line tends to make us all a little impatient or uninterested in the fine-print legal details.  While your real estate lawyer will explain the purpose of all real estate legal documents and what they mean in plain English, we put together some further insight into what to expect when you are at the signing table. 

    Charge (A Fancy Name For A Mortgage)

    If you are taking out a mortgage to buy your new home,  the Charge/Mortgage is the document registered against your home in the Ontario land titles registry.  

    When reviewing the Charge/Mortgage, you may notice in the “Chargor(s)” section reference to whether or not you are a spouse. The reason for spousal information being includes, even if they might not be on title of the property is because a spouse must provide his/her consent to the mortgage.

    Consent To Also Act For Your Bank

    When your transaction involves a mortgage, your lawyer will generally act for both you and your mortgage lender (or lenders in some cases) to save you the cost of paying for two lawyers.

    While this isn’t the norm to the rules in most other legal transactions, where each side retains their own representation, an exception to the rule permits a lawyer to act for both parties only if he/she is given permission from both parties to do so.  

    When signing real estate legal documents for the purchase of your new home, you may come across a document called “Consent to Act…”.  By signing this document, you give your lawyer permission to act for both you and your bank.

    Acknowledgments And Directions

    Acknowledgments and directions are documents signed by you and used by your lawyer as written confirmation that you have reviewed certain documents and that the information is accurate. A direction states that you authorize and direct your lawyer to take certain action. Your lawyer may require you to review and sign an acknowledgment and direction before your mortgage or the transfer of title is registered. Your lawyer may also require you to review and sign a direction for the transfer of funds from your bank to be held in trust by him/her until the amount is paid to the home seller.

    Transfer of Title

    The Transfer of Title is a document that is registered with the Ontario land titles registry.  In a nutshell, this document directs the transfer of interest in the home.

    Joint Tenants or Tenants In Common

    If you’re buying your home with other people such as a family member or a spouse, you may be asked if you’d like to be registered as “Joint Tenants” or “Tenants in Common”.

    With joint tenancy, you co-own 100% of the home with the other people on title and no one person owns a specific share of the home. For example, spouses may purchase a home together as joint tenants because, in the event that one of the spouses passes away, 100% of the ownership of the home then automatically belongs to the surviving spouse.  

    On the other hand, with tenancy in common, you own a specified share of the home and may be able to transfer or sell that share to others. Upon death, the share of the home will pass to the tenant in common’s heirs.  Often times in co-ownership or investment properties the owners are considered tenants in common.

    Statement of Adjustments

    The statement of adjustments likely gets the most questions during the signing appointment.  Put simply, a statement of adjustments summarizes the monies that will be exchanged, less any adjustments (deductions in the favor of the buyer or seller). 

    The statement of adjustments is similar to your monthly bank statement, as it has a list of various debits and credits with a balance at the end. In the buyer’s statement of adjustments, the debits represent amounts already paid, such as the deposit, while the credits include the purchase price of the home and any fees or utilities the seller has prepaid. The total amount in the credits column (purchase price + prepaid items) minus what’s in the debit column (the deposit) is what you owe to the seller on closing day.

    If you are buying a home, you’ll likely see your purchase price, plus any additional fees, less any deposits you’ve put down and funds that are coming in from your lender.  The balance of the statement is what you’ll need to pay at closing.

    If you are selling your home, you’ll see items such as proceeds from your sale, property tax adjustments, deductions for real estate commissions, and a payout to your mortgage lender, as applicable.

    The more you know, the smoother your transaction will.  Now that you have a better idea of what documents to expect at your signing appointment, taking a few minutes to prepare questions or ask for clarifications is always a good idea.

    At Deeded, we’re committed to making your Real Estate transaction seamless and smooth.  We believe that consumers should be empowered and in control of the most significant purchase or sale they’ll likely make. 

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  • 7 Questions to Ask a Real Estate Lawyer When Buying

    7 Questions to Ask a Real Estate Lawyer When Buying

    If you just firmed up your purchase or sale (Congrats!), you’ll likely need to choose a Real Estate lawyer to facilitate your closing. No matter which lawyer you choose, asking the right having the questions to ask a real estate lawyer before deciding who is going to handle your transaction can make, or break, the entire experience. 

    Here are some questions to ask a real estate lawyer considering them to represent you when buying or selling a house or condo:

    How Long Have You Been Practicing?

    Before hiring a real estate lawyer, it can be crucial to find out how much experience they have in the industry handling residential real estate transactions.  

    A good question to ask is how many transactions they have closed in the course of their practice.

    Although, it is not always necessary to find a seasoned professional with decades of legal work on their resume, finding a fairly experienced lawyer is extremely valuable.  Like any specialists, Real Estate lawyers who exclusively practice in Real Estate are more likely to have a wealth of knowledge and experience that will help with your transaction in comparison to someone who may be practicing in other legal disciplines. 

    What Do Your Closing Feed Include?

    Upon closing, the last thing you want is to be surprised at additional/unexpected closing costs. In addition to legal fees, there can be additional closing costs such as for title insurance, land transfer tax, disbursements and government fees. 

    While sometimes circumstances may lead to additional charges, make sure you know what your lawyer will charge you for legal fees and what they expect to charge on top of legal fees.  

    Things can get confusing as some lawyers may offer fixed fees which combine legal fees, disbursements and other charges into one overall bill, while some may advertise or quote their legal fees and will add additional fees and disbursements.  It is therefore important to ask and understand what an estimated final bill will look like, after legal fees, disbursements and government charges.

    While buying a home has most people strapped for cash as expenses can rack up quickly, the lowest price lawyer isn’t always the best choice.   What may look initially as saving a few hundred bucks can easily turn into thousands in potential additional costs if parts of the transaction aren’t done right.  Make sure to hire a professional who you feel comfortable with.

    Deeded offers transparent pricing so that you know exactly what is included in your legal fees and what to expect in terms of additional fees or disbursements.

    What Should I expect In Terms of Process?

    Buying or selling a home is a major transaction.  It is important to understand the closing process, especially when your lawyer’s office will be in contact, what information or documents they might need from you, and when you should expect to get updates on the progress of your transaction.

    Since every lawyer works in a slightly different manner, it is important to clarify and understand your role in the process in order to ensure a smooth closing.

    What is My Title Insurance Premium?

    Most purchase, sale and refinancing real estate transactions will include a title insurance policy in order to protect you and your lender from an array of issues that can occur after closing.  

    Title insurance costs vary depending on the price, location and type of property you are purchasing or refinancing and can range from a few hundred dollars to a few thousand,  so knowing what to budget in additional costs can save you from surprises down the road.  

    Our calculator estimates your title insurance premiums, but rates can vary greatly so please check with your lawyer to ensure you are getting the most accurate premiums for your transaction.

    How Much Land Transfer Tax Will I Pay?

    Land transfer tax applies if you’re purchasing a property.  The amount of taxes paid can be significant and vary depending on the price of your property, what municipality it is located in, and whether you’re eligible for rebates such as a first-time buyer rebate.   

    Land transfer taxes can be the most significant part of your closing costs, so it is important to know what to expect up-front.   

    Our land transfer tax calculator can estimate what you’ll be expected to pay, but it is important to verify any details with your lawyer and see if you’re eligible for any rebates.

    Are There Tax Implications For My Transaction?

    While your Real Estate lawyer likely doesn’t provide tax advice, your real estate transaction may trigger tax implications such as HST payable on a new construction home or an investment property, all the way to income taxes or capital gains taxes in certain cases.  There are also situations where you may be eligible for certain tax rebates to offset taxes payable.

    Nobody likes to be slapped with an unexpected tax bill or even worse, a re-assessment, so understanding what your transaction may trigger may be a question you’d want to ask your real estate lawyer or accountant.

    When and Where Will The Signing Take Place?

    Signing typically refers to having a meeting with your lawyer to sign the requirement documents for your Real Estate transaction.  Signing typically takes place a few days prior to closing and may involve all registered owners (whether you’re buying or selling), attending the signing appointment.

    Because life gets busy with work, travel and the occasional vacation, it is important to know when and where you're signing will take place.  If you won’t be in town or have other commitments that prevent you and other registered owners from attending a signing appointment (usually during business hours), your closing may be delayed.

    Deeded offers at-home signing appointments as part of our service.  This means we come to your home at a convenient time (including evenings and weekends) so you don’t have to take time off work or travel to a lawyer’s office to attend your signing appointment.

    In summary, choosing your Real Estate lawyer with care and asking the right questions up-front can prepare you for a smoother home closing, reducing surprises, and get you into your home faster.

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