Real Estate Law: Frequently Asked Questions – 2021

A home is one of the most significant investments a person will make over their lifetime. While everyone hopes for a straightforward experience when it comes to buying or selling property, the process often involves making quick decisions and back-and-forth negotiations, which can take its toll on both parties. With so much of your money on the line, it’s extremely important to ensure that all your decisions and transactions are overseen by a professional real estate lawyer who understands the necessary laws and procedures.

At Simard & Associates, the Real Estate Law team can help you navigate the legal issues of buying or selling . We have extensive experience in dealing with the real estate laws both locally in Ottawa, as well as on a provincial scale, and have successfully helped clients buy and sell property for more than two decades.

Read on for answers to your common questions about real estate transactions. If you would like more information on any of the topics discussed, click on a question area below.

Real Estate Q&A

Q: Should I consult a lawyer prior to signing an Agreement of Purchase and Sale?

A: Since a purchase or sale of property is generally the biggest transaction most people will be involved in during their life, it is especially important to take extra care when entering into a contract. This includes consulting a lawyer prior to signing an Agreement of Purchase and Sale. While most real estate boards and the Ontario Real Estate Association provide standard agreement forms, every agreement should be professionally reviewed by a lawyer who can amend the document to better serve buyers or sellers.

Here are some additional reasons for consulting a lawyer before signing an Agreement of Purchase and Sale:

• Provides you with options to add a clause which constitutes a conditional offer upon review by a lawyer and satisfaction of the contents of the agreement.
• Allows the buyer and seller to gain a thorough understanding of the terms and opportunity to seek legal advice and make any changes based on the advice received.
• Provides both buyer and seller with peace of mind.

Q: Can both the Vendor and Purchaser have the same lawyer?

A: In Ontario, it is standard for each party to an Agreement of Purchase and Sale to have their own lawyers. According to the lawyers’ Rules of Professional Conduct, the same lawyer cannot represent both parties, except for very limited circumstances. If a lawyer should represent both the buyer and seller simultaneously, they risk contradicting their fundamental obligations which include serving clients proficiently, keeping details confidential and staying loyal to their specific client.

However, buyers and sellers can work with lawyers hired from the same law firm provided that both parties understand:

• There is a dual retainer.
• Information between parties will not be kept confidential.
• Both lawyers must withdraw if there is a conflict.

Q: When do I qualify for the Land Transfer Tax rebate?

A: When buying a home in Ontario, you are responsible for paying Land Transfer Tax. Fortunately, if you are a first-time home buyer, you may qualify for the Land Transfer Tax Rebate. First-time home buyers who qualify can receive a  Land Transfer Tax refund. In order for our team to properly assess your eligibility, you may need to answer a series of questions first.

Q: Does my spouse need to consent to the sale of my property?

A: In Ontario, it is not permissible to sell your matrimonial home without the consent of your spouse if you are legally married. However, different rules apply if you are in a common law relationship, as the person authorized to sell the property is the person who is listed on the title. In this case, consent from your common law spouse is not mandatory.

Any property, including traditional single-family homes, condominiums, cottages or even time-shares may be considered a matrimonial home as long as one party has an interest, and it is ordinarily occupied by that person and their legal spouse. You may even have more than one matrimonial home at a time and both spouses will be required to sign any closing documents. If one party does not provide consent, the real estate lawyer acting on the buyer’s behalf will not be able to accept these documents.

Q: Do I need a lawyer to renew my mortgage?

A: The mortgage renewal process can be quite straightforward and does not necessarily require you to obtain a lawyer. However, if you want to ensure that all your mortgage needs are met, it may be wise to consult a real estate lawyer. Each mortgage renewal presents the opportunity for you to assess your current term and renegotiate the terms of your contract.

While a lawyer is generally not needed for the mortgage renewal process, the following are some instances in which you will need legal advice and services:

• To refinance or increase your existing mortgage beyond the original limits.
• Discharge your former mortgage.

Q: Do I need a lawyer to refinance or increase my mortgage?

A: In short, yes. Under normal circumstances, you will need to consult with a real estate lawyer when it comes to refinancing or increasing your mortgage. Despite the fact that a number of financial institutions now providing refinancing services, it’s always a good idea to have a lawyer review your mortgage. We can walk you through all the necessary steps to ensure you and your bank have a properly registered mortgage, as well as ensure its prompt discharge when required.

Some of the benefits of working with a real estate lawyer when refinancing or increasing your mortgage include:

• A lawyer will review your mortgage loans and its terms and conditions.
• A lawyer will register your new mortgage.
• A lawyer will conduct a title search to ensure there are no liens against your property.
• A lawyer will facilitate the entire financial transaction between you and your lender

Q: What is Title Insurance?

A: If you are buying a home in Ottawa or elsewhere in Ontario, your lawyer will likely ask you if you want to buy Title Insurance. Buying a residential or commercial property not only means purchasing the physical structure itself, but it also means that you are purchasing the “title”. In this case, “title” is used as a legal term that indicates you have legal ownership of the property. When the owner of the property signs the transfer document, or deed, over to you, you obtain the title, and it is then registered in the government’s land registration system.

While Title Insurance is not necessarily required in Ontario, your lawyer can help you determine if you should purchase it or if other options exist for your case. Once you understand the facts, you can make an informed decision based on your specific needs.

Q: How much time do you require to complete my transaction?

A: In general, a timeline will be set to allow a successful transition for both the buyer and seller. At our office, we set a minimum of 10 business days for the transaction to be completed when an Agreement of Purchase and Sale becomes unconditional. In a sale, we require this time to prepare all the documents and secure tax information, in addition to mortgage discharge statements. In a purchase, we require this time to complete various searches such as title, compliance, tax, and sheriff searches as well as correspond with the appropriate authorities to ensure that a purchaser has a clear title. If a problem is uncovered, the necessary steps will be taken to address the problem before the transaction is completed. If we have less than 10 business days to complete the transaction, you may be required to pay a fee.

Q: What tasks am I responsible for in a purchase?

A: Once you find a home you love you can make an offer on the listing and outline any conditions you want included. Conditions could include things like being able to sell your current home, or having the seller agree to get work done on the property before the deal is closed. It is up to the buyer to hire a home inspector and include a satisfactory inspection as a condition to complete the purchase. Make sure to outline your conditions in writing in addition to satisfying other requirements such as securing the necessary financing and insurance for the property. You are also responsible for organizing payment agreements with the various service providers including hydro, water, gas, cable etc. Upon finalizing your Agreement of Purchase and Sale, a lawyer from our firm will get in touch with you to conduct the intake process and answer any questions you may have.

Q: What tasks am I responsible for in a sale?

A: If you have accepted an offer, you will be responsible for notifying your service providers of the date of closing and take action to close these accounts. You can expect to receive a final account for the various services you have received up to the sale of the property. Once the Agreement of Purchase and Sale has been approved, a lawyer from our firm will contact you to get the intake process started and answer any questions you may have.

Q: Is a condominium purchase or sale different from the purchase or sale of a home?

A: Buying or selling a condominium is slightly more complex to navigate than buying or selling a home. Condominiums falls under a drastically different set of rules than buying or selling a home. Some of the major differences can relate to the ownership, repairs and defects, as well as any modifications to the property. Fortunately, we have an experienced team of real estate lawyers who can advise you on condominium law and help you navigate the complexities of buying or selling a condominium.

A real estate lawyer from Simard & Associates can help you check off many boxes during the purchase or sale of a property. Before you can exchange keys, there is a significant amount of paperwork that needs processing, and a professional lawyer can offer expert legal advice and guidance to ensure the process runs as smoothly as possible.

While our responses to these frequently asked questions are accurate, each real estate transaction is unique and may have different outcomes. Hiring a lawyer early in the process for your real estate deal can help you avoid legal issues or pitfalls. Get in touch with our Real Estate legal team today to discuss your situation. We’re here to take some of the stress out of buying and selling property.