The members of our Real Estate Practice Group provide the highest level of service in residential and commercial real estate transactions. Veritas Law has a substantial real estate practice representing developers, landlords, institutional lenders, investors and individuals.
Our practice includes the following areas:
For most people, buying a home is the biggest financial decision they will ever make and it is often the first time they have had any dealings with a lawyer. The Real Estate Practice Group at Veritas Law is ready to guide you through this exciting ”closing” process.
The first step is for us to obtain a copy of the Contract of Purchase and Sale from you or your real estate agent. We will immediately go over the Contract, note all the important dates and perform a title search and a tax search on the property. The title search will show us who the current owner is and if there are any existing financial encumbrances (mortgages) or any non-financial encumbrances (covenants) registered against the title. It will be the job of the Seller’s lawyer to remove any financial encumbrances from the title. The non-financial encumbrances stay on the property. These could be covenants which in some way restrict the use of the property. The restriction may be as simple as, for example, not allowing chickens to be bred on the property or it may be more restrictive such as Right of Ways or easements which allow access over the property or a portion of the property by someone else (such as the District of West Vancouver) and may as a result prevent building in that area. Once we have obtained a title search we can order copies of anything that is registered against the property and go over them with you.
We will then want to know whether you will be getting a mortgage. We will ask you to provide us with the name of the mortgage company and the name and phone number of the person that you have been dealing with. If you have been dealing with a mortgage broker, we will also need their information. You will need to inform the mortgage company that our law firm will be acting for you. They will then send us “mortgage instructions” which outline the details of the mortgage and allow us to prepare all of the mortgage documentation. It will be a condition of the financial institution advancing the funds through our office that we register the mortgage against your newly purchased property. Similarly, it will be a condition of us forwarding the purchase funds to the Seller’s lawyer that he discharge any pre-existing mortages registered against the property.
Some mortgage companies require a survey certificate. This document is simply a picture of where the house is situate on the lot and shows if there are any encroachments on to a neigbour’s property. This can be obtained from a Surveyor and can cost around $350-$500. If the Seller has had one prepared, that will save us from ordering one. Alteratively, the mortgage companies allow us to order title insurance in lieu of a survey certificate. Basically the title insurance provides insurance to the bank if there may happen to be an encroachment. This can cost around $150-$500.
Property Insurance (fire, third party liability, etc.) will need to be in place prior to the completion date. This is because the Lender will have to be named as a first loss payee (meaning, if the house burns down and is not rebuilt then the insurance proceeds go to the Lender and is applied to the mortgage). You will need to let us know whether you arranged this insurance or whether you would like us to arrange for a local insurance agent to contact you.
We will also need to know the full names (including middle names) and occupations of each person going on title (these people must all be on the mortgage documents as well). The people “on title” will be the registered owners of the property. If there is more than one person, we need to know whether you would like to be registered as Joint Tenants or Tenants in Common. Joint Tenants means that if one of you passes away, the deceased’s interest in the property will be transferred automatically to the surviving joint tenant(s). Tenants in Common means that if one of you passes away, the deceased’s interest in the property will form part of their estate and will be transferred according to their Will.
We also need to know whether you will be moving into the property.
Once we have all of the required information, we will prepare the documents to be signed by everyone who is going on title. These documents must be signed prior to the completion date but can be e-mailed or couriered to you if you will not be in town. Some of the documents will need to be witnessed in front of a lawyer or notary if you are getting a mortgage. We will also prepare and forward the documents that the Seller will have to sign to transfer the property to you.
As far as closing costs are concerned, we will do a Statement of Adjustments that sets out the exact amount needed to complete the transaction. The Bank will advance that portion of the closing cost covered by your mortgage funds directly to us but you will be required to provide us with the balance of the funds needed prior to closing. The funds will be calculated in Canadian dollars and can be wired by you to one of our trust accounts or you can bring us a certified cheque for the amount due.
Some of the expenses that will be included in the Statement of Adjustments are: (a) BC Property Transfer Tax. Essentially this is a sales tax that is paid when you purchase land in BC. The tax is 1% of the first $200,000 of value of the Property and 2% thereafter. (b) Municipal Property Tax, Water and Sewer (also known as Utilities) Adjustment. Property Taxes are paid in the middle of the year, but cover the calendar year. Utilities are usually paid on an annual basis but this varies from area to area. The amount of utilities is not usually very large. The Seller will have paid property taxes for the entire calendar year, but you will be living in the property for part of the year. Thus, at closing, you will have to reimburse the Seller for the taxes they have paid from the adjustment date to the date of closing). (c) There will probably be an insurance binder fee (approx $25 to $40 depending on your insurance agent). This is a fee that the insurance agent charges for adding the Lender to your insurance. (d) As mentioned above, there will be a fee whether we go with a survey certificate or title insurance. (e) If applicable, there may be adjustments for strata fees. (f) Finally, there will be our legal fees and disbursements for the purchase and mortgage (land registry fees, search fees, couriers, land title agents fees, tax searches, etc.).
Before the closing date, we will have aleady forwarded to the Seller’s lawyer or notary the documents that the Seller needs to sign to complete the transaction. On the actual closing date, both sides have usually already signed all the necessary closing documents and are normally only waiting for the funds to be advance by the mortgage company. The closing documents and funds are all exchanged on the lawyer’s “undertakings” to only use the funds in the manner directed.
While the transfer documents and your mortgage documents all get registered with the Land Title office on the closing date, it usually takes a few weeks for the formal discharges of the prior mortgages and the new Certificate of Title showing the cleared title and your new ownership to be received. Once we get the Certificate of Title, we send it to you together with our final reporting letter.