Real Estate

If you’re looking to buy a property, the first thing you need to verify is what you can afford. While a real estate agent can help you find a home, a financial or mortgage specialist can first help you determine your limits and what’s financially within your reach. Regardless of your situation, you’ll need to know the basic legal requirements.

All deals for purchasing property must be in writing. Whatever is in the agreement will prevail, so it’s important that all the necessary points be included. As a buyer, your main job is to inspect the property, because what you see is what you get, unless something else is agreed upon explicitly in your contract.

In short, pick a property you can afford, so your closing can be smoother and help you minimize any risks and involve a lawyer you trust, so they walk you through the process on closing.

You should start looking for a lawyer you trust when you want to engage in a private deal, need your contract reviewed, or have a binding offer. The sooner you get them involved, the better, but if you’re working with an experienced real estate agent, they’ll point you in that direction as soon as the contract is signed.

The land registry system in Ontario is handled almost entirely by lawyers, and that’s the main reason why lawyers are needed for any real estate transactions. When you buy or sell a property, it’s your lawyer’s job to ensure that the deal is made in accordance with the terms of the agreement, and once completed, they are responsible for registering the change in ownership with the Land Registry Office.

Properties may carry with them problems from previous owners that, if not attended to, are inherited by the new owner. It’s your lawyer’s duty not to make you the owner of a property with a bad title and to ensure you don’t inherit any issues you’re not agreeable to.

It’s also important to know that mortgage lenders won’t generally give money to a buyer directly. Money is sent to a lawyer on the condition that the mortgage, which was promised, is registered against title to a property, before the money can be used. Lawyers become in charge of that process and your lawyer is the one accepting the mortgage money and paying on the day of closing.

By the time the closing date of a real estate transaction comes around, most of the legal work has already been done. The parties should be satisfied with the condition of the property and lawyers exchange keys, money and official documents. Once exchanged, they change the property records to effect the change in ownership. The deal is then finished, and keys can then be given at that time.

A seller’s lawyer is responsible for paying the mortgage(s) on the property and distributing funds to the seller. Sale funds typically are given to a seller either the day of closing, or the next banking day.

When a deal can’t close on time, the focus is usually to negotiate an extension. While this is typically accompanied by additional costs, it’s often the most favourable option for all parties. There can be a variety of reasons why a deal doesn’t close, however, and each circumstance needs to be reviewed by a lawyer.

Knowing the ins and outs of the real estate world is very important in these circumstances. Knowing how to deal with technicalities and with negotiating favourable terms are tools that are invaluable. It’s important to have a lawyer who understands the area and can advise you well if this ever should occur.

A Status Certificate is a compilation of documents that relate to a condominium property. When you are buying a condominium property you get title to the unit you agreed to under the Agreement of Purchase and Sale. You’re also buying, however, a percentage of the corporation that holds all the areas commonly shared by all the owners. This might include lobbies, elevators, recreational facilities, parking, or many more. This condominium corporation is made specifically for the purposes of the property’s management and is very regulated.

A condominium corporation must collect money on everyone’s behalves, maintain the common areas, pay property taxes on them and have a reserve fund. That reserve fund is a bank account for future maintenance and repairs.

A Status Certificate is a series of documents that confirms a condominium corporation follows its obligations under law and gives a picture of the corporation’s standing at the time it’s issued. If there are repairs to be made, or there are court cases to which the condominium is a party, these details are described. The Status Certificate also shows whether the individual unit owner is compliant or in arrears of any payments and includes the condominium’s financial statements.

It’s important to ensure you’re purchasing in a well-managed condominium to avoid risks of future costs or sale problems down the line. A condominium with a Status Certificate wrought with problems, will often lead to an inability to get mortgage approval. For this reason, almost all condominium purchase agreements will be conditional on a lawyer reviewing the Status Certificate.

Some properties, while they may look to be full freehold properties, are what we call Parcels of Tied Land properties (POTL). A POTL property is one where you have a regular home or town home, which enjoys all the rights that a regular freehold property would have, but also has some sort of shared element with its neighbouring properties. Most often, this is a shared private roadway or lane. Since the roadway or lane is not a public road, the group of properties that are attached to it share its ownership and therefore its obligations too. This form of group ownership falls under the Condominium Act and that’s why a Status Certificate is needed.

A corporation is created to deal with the group’s interests. Using this body, money is accepted by all the parties, a reserve fund is created for future maintenance and repairs, and the funds are also used to maintain the shared property.

This kind of property is therefore very much like a hybrid between a freehold property and a typical condominium property.