The Legal Process of a Real Estate Deal: What to expect from your Lawyer
As one of the top real estate markets in North America, Vancouver has seen a consistent increase in both the value and volume of real estate transactions occurring each day. A successful real estate transaction is not just about finding the best buyer or finding your dream home, but most importantly it is about finalizing a solid agreement and ensuring that all obligations and procedure are properly satisfied.
Our goal at Segev LLP is to guide you through the legal process of Conveyancing and to ensure you understand how it works. Therefore, we created this series of articles called “The Legal Process of a Real Estate Deal: What to expect from your Lawyer” which will cover the following three topics related to conveyancing: Sale, Purchase, and Refinance.
Our first topic covers the process of selling real estate. We have divided the legal process of selling your property into three main steps: compiling information, reviewing and signing documents, and completing the deal on the closing date. After the Contract of Purchase and Sale (the “Contract”) has been finalized with the help of your realtor, it is time to sit back and put our real estate team to work for you.
- Gathering Information about the Property:
After receiving and reviewing the Contract, we begin by compiling information. We start by ordering a property title search and requesting payout statements (if applicable).
Title searches show us ownership information as well as any charges registered against the property. We can then determine which charges need to be discharged, such as a mortgage, a judgement, or a lien. In order to ensure that the sale proceeds will be enough to cover the cost of removing these charges, a payout statement is requested from the charge holder which sets out the total amount owed.
The Purchaser’s solicitor will then prepare and provide us with various documents (the “Vendor’s Documents”), which brings us into our next step.
- Reviewing and Signing Documents:
This is the stage where we meet with you to explain and review the Vendor’s Documents, after which we will ask you to sign and complete them in full. The Vendor’s Documents may include:
- Form A Transfer: a form which is filed with the Land Title Office that transfers the property to the purchaser
- Statement of Adjustments: a financial statement which shows any holdbacks, adjustments, commissions, utilities, etc. that form part of the transaction
- GST Certificate: a document which sets out if any GST is payable on the property
- Statutory Declaration re: s. 116 of Income Tax Act (Canada): a document which confirms that the vendor is not a non-resident of Canada. If you are a non-resident selling property in Canada, additional steps must be taken for the purchaser to avoid tax liability.
- Parking Stall and Locker Assignment: applicable only for a strata property with assigned parking and/or storage lockers
Once these documents are signed we return them to the Purchaser’s solicitor, together with a letter accepting the undertakings placed upon us to discharge any financial charges on title and to disburse the sale proceeds as required. Now we are able to move on to our final step.
- The Closing Date – Completing the Sale:
This is the final step in the conveyancing process. On the closing date, the Purchaser’s solicitor will transfer the property by filing the Form A Transfer with the Land Title Office and provide us with the sale proceeds. We then use the sale proceeds to payout any financial charges on title (if applicable), any outstanding utilities or taxes, and our legal fees. Any remaining sale proceeds will be paid in accordance with your instructions. If there is a financial charge on title, we must also prepare a Form C Release for the charge holder to sign and return to us after the amount owed to them has been paid out in full. Once the Form C Release is returned to us, we file this document with the Land Title Office, removing the charge from title.
Our dedicated team of real estate lawyers at Segev LLP is committed to ensuring that the sale of your property completes as smoothly as possible and that you remain informed throughout the entire process.