Click on a question below to view the answer. |
Purchases
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| Q. |
I am buying real estate and would like your firm to act on my behalf. What information or documents do you need from me? |
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A. Thank you for allowing us to act on your behalf. We will need you to provide us with the following documents/information:
- A Copy of your Agreement of Purchase and Sale including all waivers and schedules.
- Complete name(s) of all people who will be going on title to the property along with date(s) of birth, current, mailing address, telephone number(s) and e-mail address(es).
- The manner in which you wish to take title (ownership) to the property. You may take title as Joint Tenants or Tenants in Common. If you take title as Joint Tenants (normally done by spouses) and one of the Joint Tenants dies, the surviving Joint Tenant automatically becomes the owner of the property and no probate taxes will be payable. Where you take title as Tenants in Common and one owner dies, the interest of the deceased owner passes to his or her beneficiary according to his or her last will. Probate tax may apply.
- You must forward our law firm's contact information to both your real estate agent and mortgage broker or lender. This is very important and should be done immediately.
- If the property being purchases is not a condominium, please send us a copy of the fire insurance binder for the property. This must be provided to us prior to closing. Failure to do so may delay your closing as your lender will not advance your mortgage funds (if applicable) without a fire insurance binder.
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| Q. |
I am providing substantially more of the funds towards the purchase price as compared to the other purchaser. How can this be legally recognized? |
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A. If more than one person will be an owner of the property being purchased, and if one person is providing all a substantial portion of the funds required for the purchase, you may want to consider entering into a special agreement to avoid any problems with respect to the distribution of proceeds upon a sale of the property. If you would like such an agreement to be prepared, please advise us in advance and we can discuss this with you. You may wish to consider obtaining independent legal advice prior to entering into any such agreement.
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| Q. |
Once my deal closes, how and when will I get my keys? |
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A. Once your purchase has closed, we will contact you. For resale properties, your keys will can be picked up at our office unless other arrangements have been made. For new purchases from a builder, the keys will be available from the site office. If you are moving into a condominium, you should contact the management office in advance to reserve any elevators that may be needed.
Since most closings occur later in the day, you can expect to receive your keys between 3:00-5:00. It is very difficult for us to give you an exact time when your keys will be available because closing times are often dependant on the lawyer for the other party in the transaction. Every effort will be made to close your transaction early in the day, however, expect that you will not receive your keys until the late afternoon of closing.
IT IS IMPORTANT THAT YOU COORDINATE RECEIPT OF YOUR KEYS WITH YOUR MOVERS. WE STRONGLY RECOMMEND THAT YOU DO NOT BOOK YOUR MOVERS UNTIL THE AFTERNOON OF CLOSING.
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| Q. |
What are Adjustments on Closing? |
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A. The typical Agreement of Purchase and Sale provides that the balance of the purchase price is payable on closing subject to the usual adjustments. On resale homes, adjustments include items that may have been prepaid by the vendor prior to closing. For example, if the vendor has prepaid the realty taxes beyond the closing date, you will be required to provide the vendor with a credit for the proportionate amount that has been paid.
On purchases of newly built homes from a builder, there are more adjustments than compared to a resale home. These may include many items such as the Tarion Enrolment Fee, installation and connection of hydro and water meters, tree planting and many other items depending on what is provided for in the Agreement of Purchase and Sale made between you and the builder.
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| Q. |
I may be unavailable to attend at your offices to sign the closing documents. What should I do? |
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A. All persons who are going to appear on title to the property as well as any guarantors (if applicable) must attend at our offices prior to closing to sign all of the closing documents.
If you know that you or another required person cannot attend, NOTIFY US IMMEDIATELY so that other arrangements, like a Power of Attorney, if possible, can be used.
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| Q. |
I am unable to attend at your office to sign the closing documents, but I have a Power of Attorney. What should I do? |
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A. Notify us immediately. Some lenders prohibit the use of Power of Attorney for use in real estate transactions. We will keep you informed of all of your options.
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| Q. |
What is Land Transfer Tax? |
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A. The provincial Land Transfer Tax is payable by the purchaser on the purchase of real estate. The tax is payable on a sliding scale. The higher the purchase price, the higher the tax payable. It is payable on closing. For those buyers in the City of Toronto, there is ALSO a municipal Land Transfer Tax which must also be paid. Depending on whether or not you are a first time buyer, you may qualify for a refund of your Land Transfer Tax.
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| Q. |
How is Ontario Land Transfer Tax Calculated? |
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The Ontario Land Transfer Tax is payable by the purchaser on closing. To calculate your Ontario Land Transfer Tax for residential properties, use the following table:
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| Q. |
How is the Toronto Land Transfer Tax Calculated? |
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A. The Toronto Land Transfer Tax is payable by the purchaser on closing. To calculate your Toronto Land Transfer Tax for residential properties, use the following table:
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| Q. |
When does the Land Transfer Tax apply? |
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A. Land Transfer Tax applies to all purchases of property whether the property is residential or commercial.
As well, Land Transfer Tax applies to the transfer of title of property from one person to another.
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| Q. |
When will the Land Transfer Tax not apply? |
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A. The Land Transfer Tax may not apply if you are a first time homebuyer. As well, if you are transferring your property into your spouse's name for no consideration (natural love and affection), the tax may not apply. Similarly, if you are transferring the property from Trustee to Beneficiary, the tax may not apply.
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| Q. |
Do I need home insurance? |
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A. Home insurance is required with you purchase a property that is not a condominium. You will need to provide us with a copy of your home fire insurance binder. If you are obtaining financing from a lender for your purchase, the lender will not provide the funds necessary for closing unless there is confirmation of fire insurance. The binder does this. Discuss with your insurance agent/broker your particular needs such as contents, liability and business coverage. You need to advise your agent or broker to send us a copy of the insurance binder prior to closing.
If you are buying a condominium, we do not need a copy of the fire insurance binder. However, you need to arrange for contents insurance for your personal belongings.
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| Q. |
What kind of identification must I provide to your office? |
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A. In order to prevent real estate fraud, both the Law Society of Upper Canada and the banks and financial institutions require that you prove your identity. When you attend at our offices to sign the closing documents for your purchase (typically one or two days prior to closing), you will need to provide us with two valid pieces of photo identification. We suggest that you provide us with a valid driver's license as well as a passport. If you do not have valid personal identification, please notify us immediately.
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| Q. |
What is title insurance and why should I consider obtaining it? |
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A. Most transactions close with title insurance. As lawyers, we are obligated to provide you with the options available to protect your interests
and minimize your risks in your transaction. Title insurance is an excellent way to protect your interests in a real estate transaction.
All of our residential real estate transactions close with title insurance. It is economic and provides you with additional protection
that goes beyond what a solicitor's opinion on title can provide. Title insurance can save you money by eliminating some of the time-consuming
and costly searches that would have to be done at your expense. For a modest one-time premium, title insurance can be obtained. The coverage
under the policy protects you for as long as you retain an interest in the property. No further payments are required. Residential title
insurance can protect you against a number of defects including fraud, survey defects, encroachments, zoning infractions and other defects.
Title insurance may be obtained for the home you are buying or even if you already own your existing home.
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| Q. |
Is a survey of the property required? |
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A. Despite the fact that title insurance is typically arranged for by our firm on every transaction, a survey is a valuable document which
a purchaser may be entitled to depending on what is provided for in the Agreement of Purchase and Sale. Title insurance may eliminate the lender's
need for an up to date survey, however, a survey can provide you with valuable information such as the size of the lot being purchased, the location
of any additions made to the property as well as the location of any easements or rights of way that may be on the property. This information may
be important should the purchaser wish to make changes or additions to the property in the future. Should you have any questions about the wording
that should be inserted into an Agreement of Purchase and Sale, please contact one of our real estate lawyers for a free consultation.
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| Q. |
If I am getting a bridge loan, what do I need to do? |
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A. A bridge loan is often used when you are selling one property and using the proceeds of sale to purchase another property.
A bridge loan is a good idea in this case because it will allow you to purchase first and sell later. The bridge loan simply "bridges"
the gap between the two dates and allows you to have sufficient funds to close your purchase before your sale. Should you encounter a
delay in your sale, your purchase may be jeopardized. A bridge loan solves this problem and gives you piece of mind.
If you are obtaining a bridge loan please provide us with the bridge loan documents.
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| Q. |
Who is responsible for contacting the various utility and tax departments to notify them about a change in ownership? |
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A. Our office will notify the various utility companies to request a final meter reading of your meters to be done on the closing date.
You will responsible for paying the utilities up to the day of closing together with the final bill which you will receive following closing.
With respect to realty taxes, we will advise them of the change of ownership and they will send you any future tax bills unless you have made
arrangements with your lender to pay same. You will be responsible to contact any cable television, telephone and internet services providers
as well as any alarm companies.
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| Q. |
Is HST payable on all real estate? |
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A. HST only applies to purchases of newly build homes from a builder. It does not apply to the purchase of resale properties. If you are buyer a newly built home from a builder, you may be entitled to a HST rebate/ It is common for the builder to include the HST in the purchase price and that the rebate is assigned back to the builder on closing of the transaction.
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Condos
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| Q. |
I am buying a Condominium and would like your firm to act on my behalf. What information or documents do you need from me? |
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A. Same as above, but add status Certificate.
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| Q. |
How is Condominium ownership different from owing a freehold home? |
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A. As a condominium owner, you are legally obligated to follow the various condominium rules, regulations and by-laws. Failure to do so may result in discipline action against you by the Board of Directors of the condominium. You will receive a copy of the documents containing these rules and satisfy yourself to confirm that you are not
violating any of these rules.
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| Q. |
I have signed an Agreement to purchase a resale condominium and the offer is conditional upon my lawyer's review of the Status Certificate. What should I do now? |
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A. You should contact us so that we can provide you with a free review of your Status Certificate. The Status Certificate is an important document which will provide important information on the Condominium Corporation such as the monthly common expenses, the amount of the Reserve Fund, any possible special assessments and possible lawsuits against the condominium corporation.
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| Q. |
I have bought a brand new condominium from a builder. Why are there two closings? |
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A. When purchasing a brand new condominium from a builder, there are typically two closings. There is the occupancy closing where the purchaser
will occupy the unit. You will need to attend at our offices to sign the required documentation. You will be responsible for paying the monthly common
expenses, property taxes and occupancy fees.
There will then be a final closing which will take place once the condominium's declaration has been registered. Final closing will take place
sometime after interim or occupancy closing. You will be notified by your builder of the final closing date. On final closing, you will be
required to pay the balance of the purchase price to the builder. It is important that you arrange for your financing to be in place in time
for final closing so that there are no delays which may result in penalties to you.
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| Q. |
I have just bought a condominium. What are my monthly common expenses and what is the meaning of the term reserve fund? |
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A. Common expenses are your unit's percentage allocation of the expenses needed to run the condominium building. They are payable to the Condominium Corporation. The Reserve Fund is a fund set up by the Condominium Corporation to pay for any expenses that the condominium may incur such as repairs and maintenance. A Condominium Corporation is required to conduct a Reserve Fund study to ensure that the condominium has sufficient funds to maintain the condominium. If there are insufficient funds, the common expenses may increase.
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New Homes
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| Q. |
I have just signed an Agreement of Purchase and Sale to purchase a brand new home from a builder and the offer is conditional on my lawyer's review of the Agreement. What should I do? |
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A. It is very important that you have us review the Agreement of Purchase and Sale. Builder's Agreements are often very one-sided in favour of the builder and may have additional expenses which you may not know about as well as various clauses which may affect your use and enjoyment of the property. For that reason, the Agreement should be reviewed by a lawyer. It is very important that you have this reviewed prior to the expiry of the conditional period so that your interests are protected. Contact us to make an appointment to review the Agreement.
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| Q. |
I am a first-time buyer and have just bought a home. Am I entitled to a refund of my Land Transfer Tax? |
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A. Yes, provided that you intend to occupy the property within nine months of the closing date and you are not married to someone who is not a first-time buyer.
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| Q. |
How does the GST rebate work with new homes purchased from a builder?
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A. If you or a relative of yours are going to live in the home, you receive a rebate of the GST which is assigned to the builder on closing. If you or a relative are not going to be living in the home, you must pay the GST and do not receive the GST rebate. This will be paid on closing as an Adjustment.
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| Q. |
What is Tarion and how can I learn more about it? |
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A. Tarion is the provincial body that regulates builders and the new home building industry. It also licenses all new home and condominium builders in Ontario. Tarion is responsible for providing new home and condominium buyers with both warranty protection and deposit protection as well as some protection against delayed closings. For more detailed information on Tarion, they can be contacted at 1 800 668-0124 or at www.tarion.com.
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| Q. |
I have purchased a new home from a builder and must complete a Pre-Delivery Inspection (PDI) form prior to taking possession of the property. What is the PDI? |
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A. Tarion is the provincial body that regulates builders and the new home building industry. It also licenses all new home and condominium builders in Ontario. Tarion is responsible for providing new home and condominium buyers with both warranty protection and deposit protection as well as some protection against delayed closings. For more detailed information on Tarion, they can be contacted at 1 800 668-0124 or at www.tarion.com.
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| Q. |
What is Tarion and how can I learn more about it? |
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A. Purchasers of newly built homes will attend at the property prior to closing to inspect and prepare a list of any deficiencies that require the attention of the builder. It is very important to conduct inspection carefully and note any deficiencies on the PDI form in writing. Your builder will contact you directly to arrange for the inspection.
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Mortgage Refinancing
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| Q. |
I am refinancing my property. Can your office assist? |
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A. Yes, we can assist as we act for major financial institutions as well as private lenders. Please contact us for a free quotation.
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Sales
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| Q. |
I am selling my home and would like your firm to act on my behalf. What do I need to do and what documents do you need? |
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A.
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Contact utilities for final meter readings
Details of any existing mortgages, lines of credit or other liens registered against the property. We will need the name of the lender, address and phone number as well as the loan number.
Existing survey of the property if available
Current year's realty tax bills
Forwarding address and future telephone number
At least one key to the property to be provided when you attend at our office to sign all of the closing docs. Other keys should be left on the kitchen counter
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| Q. |
Who must attend for signing of the closing docs? |
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A. If ownership of the property is in the name of one spouse, but the property is a matrimonial home, the non-titled spouse is required to attend at our offices to sign the transfer as a consenting spouse. As well, the proceeds of sale will be made payable to both spouses unless we receive a written direction otherwise.
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| Q. |
When will I receive the sale funds? |
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A. Once the transaction has closed, the registered owners will receive the sale proceeds. The funds may be available at our offices late in the afternoon on the closing day or the following business day. If the transaction is being completed by way of Power of Attorney, the funds will be made payable to the registered owner of the property and not the person named in the Power of Attorney, unless other written arrangements have made in advance of closing.
In the event that two or more people are selling a property, the proceeds of sale will be made payable to all of the registered owners unless other written arrangements have been made in advance of closing.
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| Q. |
What happens in the event a vendor of property is a non-resident of Canada? |
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A. If you are selling a property and you are a non-resident of Canada or will be a non-resident as of the closing date, you should contact our office immediately as a we may be required to hold back 25% of the sale price until we are in receipt of a clearance certificate from CCRA.
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| Q. |
Who is responsible for notifying the utility companies, cable and telephone companies when I sell my property? |
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A. As a vendor, it is your responsibility to notify the various utility companies of the closing date as well as your future mailing address for final utility bills. You will also be responsible for contacting the cable and telephone companies to advise them of your move.
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| Q. |
My house is heated by Oil. Is there anything that I need to be aware of? |
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A. Yes. Unless other arrangements have been made with the purchaser, it is your responsibility to contact the oil company to arrange for the oil tank to be filled. You will receive a credit for this on closing.
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| Q. |
I wish to transfer title or ownership of my property to another individual. Can your office assist me with this? |
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A. Yes. Title transfers and changes are services which we can complete. We will review your instructions, prepare the necessary documents, meet with the required parties for signing the documents, register the documents on title and provide a final report. There are some matters that will remain the responsibility of the owner. This will be fully explained when you attend to sign the closing documents.
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First Time Homebuyers
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| Isenberg & Shuman are available at anytime to assist you with any questions you may have as a first time homebuyer. |
RRSP Homebuyer Plan
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The Home Buyers' Plan (HBP) is a program under which you can withdraw up to $25,000 from your registered retirement savings plan
(RRSP) to buy or to build a qualifying home. Up to $25,000 per person could be withdrawn tax-free from an RRSP to buy or build a principle residence.
In order to qualify, you must be a first-time buyer. There are certain rules that determine if you qualify as first-time buyer. You do not have to
pay income tax on the amount withdrawn as long as the funds are repaid into an RRSP in the future. For more information on the HBP and the qualification
requirements, please visit www.cra-arc.gc.ca.
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| Q. |
Am I a First Time Homebuyer? |
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A. To determine if you qualify as a first time homebuyer or a resale or newly built home, you need to consider the following:
- the purchaser must be at least 18 years of age
- the deadline for filing the refund application must be made within 18 months of the date of the transfer. Our office will complete the application at the time of closing on your behalf at no additional cost.
- the purchaser cannot have owned a home anywhere in the world.
- the purchaser's spouse cannot have owned a home anywhere in the world at the time he or she was the purchaser's spouse.
In the case where one of the purchasers is not a first time homebuyer, the refund amount will be reduced by the proportionate ownership interest of the purchaser who is hot a first time homebuyer.
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Land Transfer Tax Rebates
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If you are a first time homebuyer, you may save up to $2,000 on the Ontario Land Transfer Tax. If you are purchasing a property
in Toronto, you may also save up to $3,750 on the Toronto Land Transfer Tax.
To determine if you qualify as a first time homebuyer or a resale or newly built home, please see
the answer to 'Am I a first time homebuyer?' directly above. |
Q. |
Does your office have a Privacy Policy? |
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A. Yes, our law office values and protects the privacy of our clients and its personal information.
Collection, use and disclosure of personal information is governed by The Canadian Personal Information Protection and Electronic Documents Act (PIPEDA).
In our office, we obtain and use personal information for assist and confirm identity of our clients and to satisfy land registration requirements in order
to process and close real estate transactions. We also use personal information to draft wills, power of attorneys and other legal documents as required.
When you retain our office and provide us with personal information, it understood that you are consenting to the use of your information with respect
to the legal services that we are providing on your behalf. Should you have any questions about this, please contact one of our lawyers.
To see our privacy policy, please click here.
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