How to Begin a Real Estate Transaction with Our Firm
Step 1: Have your agent fax your Purchase and Sale Agreement to 416-920-1780 or email it to firstname.lastname@example.org along with your contact details (phone, email and address) and we will call or email you shortly thereafter to review same.
Step 2: We will then send you our Opening Letter that will include a letter outlining each and every step of our closing process with you. It will include an exact quote for your transaction as well as the amount of your land transfer tax if it applies. We will also include a retainer letter for you to sign and return to us by mail.
Step 3: We will call you to further review details that we require – contact details, how title is being taken, mortgage details and other information that is needed for us to clarify information about your transaction with you.
Step 4: For real estate Purchases – Two or three days prior to your closing date, we will contact you to schedule your closing appointment, which will be scheduled for one day prior to your closing date. At that time we will also advise you of the final amount of funds that you will bring for your closing. Determining the final amount of funds for closing requires that both the vendor’s statement of adjustments as well as the mortgage bank’s figures be sent to my office. Upon receipt of both these figures, we will contact you and proceed to schedule your closing appointment. These figures are usually only given to us at a time very close to the closing date.
During your closing appointment, we will ask you to put us in funds to cover the balance due on closing as adjusted (subject to adjustments for overpaid or underpaid realty taxes, oil [if property is oil heated], maintenance charges [if a condominium is involved] or various builders’ charges [if a new home is involved]. We will review the whole transaction with you in detail, explain all documents to you and answer any questions you have at that time. So that Law Society recommendations are complied with, your closing funds should be either by a cheque that is certified or a bank draft in the name of “FISCH & ANTONETTE, IN TRUST”.
In addition, you will be responsible for the usual closing adjustments, such as property taxes, maintenance (if a condominium), sometimes water or oil, if applicable. These adjustments will be reviewed with you prior to closing.
You will also be required to pay Land Transfer Tax to the Province of Ontario on closing. Based on your purchase price the Land Transfer Tax payable on closing will be noted for you in our opening letter to you.
You may also be required to pay Municipal Land Transfer Tax (for City of Toronto properties only). The Municipal Land Transfer Tax will be charged on a graduated basis depending on the value of consideration paid for the property. The rate on a residential property is as follows:
|Value of Consideration||MLTT Rate|
|Up to and including $55,000.00||0.5% plus|
|$55,000.01 to $400,000.00||1.0% plus|
When you bring in the final amount of funds for your closing, we will review the whole transaction with you in detail, explain all documents to you and answer any questions you may have.
FIRST TIME HOME BUYER
If you are a first time home buyer you may be eligible for a rebate of the Land Transfer Tax. Depending on your purchase price up to $3,725.00 of the Toronto Land Transfer Tax and up to $2,000.00 of the Ontario Land Transfer Tax may be waived. This does not apply to investment properties.
You have entrusted us with the task of ensuring you have proper title to the property you have purchased. We are therefore required to examine all relevant documents in the Registry office for a period of up to forty (40) years. Many other searches, such as for arrears of municipal taxes and utility charges, must also be done (if there is no title insurance). If these searches reveal anything which adversely affect the property, we will contact you immediately.
This insurance guarantees your interest in title against title fraud and many hidden risks and undescribed interests that may not be uncovered by the investigative searches conducted by a lawyer, such as encroachments of structure onto neighbouring lands or municipal property. Please refer to the the following web site www.firstcanadiantitle.com for more details.
The Controlled Substance By-Law Endorsement (will be part of our Title Insurance package)
The Controlled Substance By-Law Endorsement provides coverage should a lender suffer a loss as a result of a governmental authority forcing the removal or remedy of the structures because they were used for the purposes of the production of a controlled substance. In addition, a lender is covered for utility reconnection charges and for costs of compliance with the by-law, etc. being added to the tax bill, which forms a lien in priority to the insured mortgage. The endorsement provides a lender with coverage up to a maximum of $100,000.00.
The Controlled Substance By-Law Endorsement can only be added to a lender policy upon request. There is an additional charge of $50.00 per endorsement1.
1This material is intended to provide general information only. For specific coverage and exclusions, please refer to the title insurance policy and/or any applicable endorsement thereto. Insurance is provided by FCT Insurance Company Ltd.
Market Value Endorsement
Although the Platinum Title Insurance policy for homeowners contains a standard provision that will compensate an owner for up to 200% of the policy amount for actual loss as a result of a covered title risk, , this may not be enough coverage in areas of the country where property values have increased significantly due to the market. The Market Value Endorsement is an enhancement to the title insurance coverage that will provide homeowners with peace of mind as real estate values continue to increase. The Market Value Endorsement ensures that the policy amount reflects the increase in value of the homeowner’s property due to market conditions. Should the homeowner suffer a loss as a result of a covered title risk, the endorsement will provide coverage for that loss up to the market value of the home at the time of the loss or claim. Please note that this endorsement excludes coverage for an increase in value due to renovations undertaken by the homeowner.
The Market Value Endorsement can only be added to a new or existing homeowner policy, when purchased at the time the order is placed and there is an additional charge of 10% of the homeowner policy premium. If the endorsement is purchased subsequently, there is an additional charge of 20% of the homeowner policy premium2.
2This material is intended to provide general information only. For specific coverage and exclusions, please refer to the title insurance policy and/or any applicable endorsement thereto. Insurance is provided by FCT Insurance Company Ltd.
This firm and most banks and mortgage companies will only complete closings with title insurance.
Please advise us immediately if you are purchasing a resale house and are aware of renovations done on the property. You may be aware of renovations from the real estate listing, the Seller Property Information Statement, the Agreement of Purchase and Sale, or other sources. If we do not hear from you within 7 days of the date of this letter, we will assume that you do not know of any renovations.
If you have a written home inspection report, please advise us immediately and provide us with an electronic or paper copy as soon as possible.
USE OF THE PROPERTY
If the property will be used as a rental property or for any purpose other than as a single family residence, kindly advise us immediately. If you do have a special use for the property, please also tell us in writing if you wish us to confirm or deal with any aspect of the zoning needed for that special use.
In the meantime, there are certain other matters to be dealt with.
- Deed: Please advise us immediately the manner in which you wish to be shown on the Deed by returning the attached Retainer form.
You may own your property in any one of several ways. These are:
(a) Joint Tenancy – Title may be taken by two or more persons as “joint tenants”. If one owner should die, title will pass to the survivor by right of survivorship, unaffected by a last will and testament. This method is often used by married couples.
(b) Tenants-In-Common – Title may be taken by two or more persons as “tenants-in-common”. If one owner should die, his or her share of the property would become part of his/her estate to be dealt with according to the last will and testament. The surviving owner would retain only his/her undivided interest in the property.
(c) Individual Title – If title is taken in the name of one person alone. If that person is married, his/her spouse may acquire rights of possession or ownership in the property even though such spouse is not registered on title
There are tax and matrimonial law consequences arising from each of these choices.
If the agreement is conditional on arranging a new mortgage or on your being approved to assume an existing mortgage, YOU MUST ACT IMMEDIATELY. You should also have the mortgage broker or lender send me all necessary documentation and instructions as soon as possible. In most transactions the delay in closing is because mortgage arrangements were not started early enough.
Please note that we do not get involved in mortgage arrangements, so that if your purchase is conditional upon a mortgage being arranged before a particular date, we would ask you to keep it in mind and notify us at least five days before your closing date what the status of your mortgage arranging is so that we can assist you to notify the vendor that your condition is not met. If you do not call us in time we may not be in a position to help you on this point. Most clients and mortgage brokers delay finalizing the mortgages until very close to the closing date and that causes major problems and disappointments at the closing.
We recommend that you obtain a current survey of the property prepared by an Ontario Land Surveyor. A survey shows the dimensions of the property, indicates where the buildings are located in relation to the property boundaries, and discloses whether there are any easements, encroachments or rights-of-way over the property. All new houses and all condominiums already have surveys and do not need to be ordered.
Without a current survey, our opinion on title must be limited. For example, without such a survey, we are unable to advise you as to whether the property actually corresponds to the Deed description or complies with municipal zoning and building by-laws. A survey of the house and lot will cost at least $800.00 plus HST and is normally required by mortgage lenders before they advance money to you unless you have title insurance. If you are authorizing that this transaction be closed with title insurance, the necessity for a survey can be waived most of the time.
Except for condominiums, please arrange for your insurance agent to send or fax a binder letter to us well in advance of closing. The lender will need this letter if you are financing the purchase by either assuming an existing mortgage or by placing a new mortgage. The fire insurance coverage on the property is both for your own protection and for the protection of any mortgagee. We recommend that you obtain a comprehensive policy containing additional coverage such as contents and personal liability. Please arrange insurance as soon as possible as in the event of substantial damage before closing, you are entitled either to take the insurance proceeds and complete the transaction or to terminate the agreement.
While the property is subject to mortgage, it will be necessary to maintain insurance coverage which is satisfactory to the mortgagee(s) and which shows loss payable to the mortgagee(s).
Please note: if you are purchasing a condominium then the condominiums master policy will cover the structure and you do not need to arrange insurance for that, but you do need to arrange your own insurance for your contents, any improvements to the unit and liability inside the unit.
If you live in rented accommodation, you must give effective notice (usually two full months) prior to moving out, unless you have a lease for the rented accommodation, in which case you must try to assign the balance of the lease to a new tenant.
You should arrange for a moving van well in advance, whether hiring a mover or renting a truck. You may also wish to co-ordinate your move with the vendor’s departure by phoning the vendor directly. Most keys after closings are only available in the 3-5 p.m. time slots.
HYDRO, WATER, GAS, BELL TELEPHONE & TELEVISION SERVICES
Kindly contact your telephone supplier and your local cablevision company and the utility companies soon in order to have these services available at your new residence. Many condominiums have some or all of these services included in the maintenance fee and don’t require any communication before closing.
The purchase will be closed between 9:00 a.m. and 5:00 p.m. (the hours of the Registry office) on the closing date. The actual time of closing depends upon funds from mortgages being available and couriers delivering documents to lawyers on both sides. It is not always possible to close as early on the closing date as we would like. Therefore we may not know the exact time of closing until the day of closing. On a busy date, this may mean you will not get your keys until late in the afternoon of the day of closing. If this poses a potential problem, you should consider negotiating the closing of the purchase for a day before the scheduled closing date. Your agent can assist you in changing closing dates.
We will obtain on closing an undertaking from the vendor to pay all utility charges arising from the meter reading on the day of closing. Title Insurance covers some problems with utility arrears.
There is often a mortgage on title which must be discharged by the vendor on closing. It is our practice to pay the money necessary to discharge the mortgage directly to the lender and to accept an undertaking of the lawyer for the Vendor to obtain and register a mortgage discharge after closing.
Please advise if you wish us to attempt to alter this normal procedure. However, the Agreement you signed allows the vendor to insist that this procedure be followed.
The Post Office makes available change of address cards which you may wish to send to your friends and business associates. It is also possible to leave a card at your former local Post Office requesting it to forward to your new address any mail delivered to your former address.
In the purchase of resale homes, you may wish to arrange for a locksmith to change all the locks on your new home as soon as you take possession.
NEW HOME WARRANTY PROGRAM
If you are buying a new home, you must arrange with the builder or its representative to inspect the property just prior to closing in order to complete the “Certificate of Completion”. You should list all deficiencies or unfinished items on the certificate and obtain the builder’s agreement in writing on the dates when any unfinished work will be completed.
After closing you will receive a “Warranty Certificate” from the New Home Warranty Program. This warranty only covers matters not completed in a good and workmanlike manner and give you no protection where work is not done at all. If you have any further questions about the New Home Warranty Program, you should telephone the local office in Toronto at (4l6) 229-9200.
WATER AND SEPTIC SERVICES
In rural and cottage properties we will make the usual searches with the Health Department in connection with the water and septic services on the property. The Ministry of the Environment imposes strict regulations on septic and water systems and you may want to have a more thorough investigation carried out. If you would like us to make more extensive inquires, please advise us immediately. Please advise us if your property is on septic tank.
Careful lawyers search the corporate status of all corporations who held title to your property in the past to make sure that their charter was not cancelled before they sold your property. The cost of doing this is $2l.00 per company for each company on title for the required 40 year search. It is not our practice to do these searches, as most of my clients do not wish to spend this kind of money. If you do wish me to do these searches please call us and advise that you would like to pay for such searches.
Please note that the above quotation assumes no reasonable unforeseen complications arising. In any such event, you will be notified and an hourly rate will be quoted.
Also, the fees quoted are binding for services beginning within 30 days. Expenses may be subject to government cost changes. H.S.T. is to be added.
As we will incur certain disbursements in making searches on your account, we would ask that you place us in funds by cheque in the amount of $300.00 payable to FISCH & ANTONETTE, in trust. A credit for this amount will be given to you with our final account.
Step 5: For real estate Sales -In order for us to prepare your documents for closing, in our opening letter to you we ask you to provide us wi and you on line 1th the following:
- Your deed, if available;
- A copy of any survey of the property, if I did not act for you on your purchase of this property;
- A copy of your current tax bill (please indicate what payments have been made for the current year and if you are on pre-authorized payment program, please cancel same as soon as possible);
- The name and address of each Mortgagee and/or secured Line of Credit on your property (if any) and the mortgagee’s reference number;
- The spousal status of each person on the deed (check one)
- Married to
Subject property is / is not our family residence
- Other __________________________________
- A copy of your current water bill if you have a Flat Rate account;
- If the house is heated by oil, would you please advise us of the size of the tank;
Prior to closing, we suggest that you make arrangements for the following:
- The reading of Hydro and Water meters (if there is one) as of the date of closing, so that charges for these utilities will be made to you only up to the closing date;
- The reading of the gas meter (if there is one) as of the date of closing so that charges for this utility will be made to you only up to the closing date;
- The disconnection of your telephone and termination of this service;
- The cancellation of television cable service;
- The filling of your fuel oil tank (if any) so that we may charge the purchaser for a full tank of oil on closing;
- The transfer of insurance coverage for the contents of your house and your own personal liability to your new house. You will probably not be able to transfer your fire coverage to the purchaser; therefore, you should make arrangements for cancellation of that coverage; be careful to ensure that your agent does not automatically cancel the coverage, occasionally difficulties are encountered in closing which may delay the closing for a day or two and you should not be left without coverage.
- Cancellation of any other services which may be provided to the property, such as newspaper, soft water service, etc.
APPOINTMENT – 2-3 days prior to your closing date, when we meet to sign the documents would you please bring one (l) key to the house/apartment. The rest should be left on the kitchen counter when you leave. The purchaser may wish to have access to the house before closing. This should not be permitted without discussing it with me beforehand. We will call you a few days prior to your closing date to make an appointment.