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What am I signing for my new home?

January 6, 2012 Toronto Real Estate

Jeff Fung, Founder & CEO of MyLawBid.com

Have you ever wondered what some of those legal documents really mean as you’re signing them for your new home? The excitement of owning a new home can make us all a little impatient or uninterested in the fine-print, legal details. While your residential real estate lawyer will explain to you the purpose of each document, the following is further insight into some of the legal documents that you may be reviewing and signing.

Consent to Also Act for Your Bank

If you are financing the purchase of your new home with a mortgage, your lawyer may be able to act for both you and your bank to save you the cost of paying for two lawyers. According to the Law Society of Upper Canada, the governing body for Ontario lawyers, a lawyer owes a duty of loyalty to clients and must avoid any conflict of interest, such as acting for a borrower and a lender in the same transaction. An exception to the rule permits a lawyer to act for both parties only if he/she is given permission from both parties to do so. When signing legal documents for the purchase of your new home, you may come across a document called “Consent to Act…” where you clearly provide your lawyer with

(i) permission for him/her to act for both you and your bank,

(ii) confirmation that you understand that information received from you or your bank by your lawyer cannot be treated as confidential from either party, and

(iii) confirmation that you understand that your lawyer may not be able to continue acting for you or your bank if both parties cannot resolve a point of conflict.

Acknowledgments and Directions

Acknowledgments and directions are documents signed by you and used by your lawyer as written confirmation of your instructions. An acknowledgment states that you have reviewed certain documents and that the information is accurate. A direction states that you authorize and direct your lawyer to take certain action. Your lawyer may require you to review and sign an acknowledgment and direction before your mortgage or the transfer of title is registered on title. Your lawyer may also require you to review and sign a direction for the transfer of funds from your bank to be held in trust by him/her until the amount is paid to the vendor.

Charge/Mortgage

The Charge/Mortgage is the document registered against your home in the Ontario land titles registry if you need a mortgage to buy your new home. “Mortgage” and “charge” are used interchangeably colloquially but have distinct legal meanings (we’ll leave that discussion for another time). When reviewing the Charge/Mortgage, you may notice in the “Chargor(s)” section reference to whether or not you are a spouse. Spousal information is included because, in general, a spouse must provide his/her consent to the mortgage even if he/she is not on title. If parties to the mortgage do not have spouses, each party will need to make such a representation in the Charge/Mortgage.

Transfer of Title

The Transfer of Title, once registered with the Ontario land titles registry, is the document by which the vendor transfers to you his/her interest in the home. If you’re buying your home with other people (i.e. your partner, a family member), next to your names in the “Transferee” section of the Transfer of Title will either be the words “Joint Tenants” or “Tenants in Common”. Your choice of one legal status over another may affect your ability to transfer, sell or will your share of the home to others.

With joint tenancy, you co-own 100% of the home with the other people on title and no one person owns a specific share of the home. For example, spouses may purchase a home together as joint tenants because, in the event that one of the spouses passes away, 100% of the ownership of the home then automatically belongs to the surviving spouse. On the other hand, with tenancy in common, you own a specified share of the home and may be able to transfer or sell that share to others. Upon death, the share of the home will pass to the tenant in common’s heirs.

Conclusion

The above is only a summary of some of the more common documents that you will come across in a real estate transaction. The more complicated the transaction, the more likely there will be more complicated legal documents to review and sign. If you have any questions about what you are signing, be sure to ask for clarification from your residential real estate lawyer before signing so that, once you move in, you can sleep soundly in your new home.

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Contact the Jeffrey Team for more information – 416-388-1960

Laurin & Natalie Jeffrey are Toronto Realtors with Century 21 Regal Realty.
They did not write these articles, they just reproduce them here for people
who are interested in Toronto real estate. They do not work for any builders.
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G20 bank closings ‘brutal’ for real estate industry

June 14, 2010 Legal Real Estate Issues, Miscellaneous, Mortgages and Financial Information

Tony Wong – Yourhome.ca

Forget about the fake lake. What if you can’t close on the sale of your property because your bank was shut down for the G20 Toronto summit?

While media attention might be on the uproar over the $1.9 million man-made lake and pavilion being built for the media at the meeting of world leaders, real estate and legal professionals are worried over a potential “disaster” in the making.

The last Friday in June is traditionally the busiest for house closings from buyers who have purchased in the spring market that saw record sales this year. If downtown banks close during that week thousands of closings could be affected creating major market turmoil, say industry professionals.

“It was already going to be brutal without the summit because we’ve been so busy. The timing couldn’t be worse,” says Andrew Zsolt, president of Coldwell Banker Terrequity Realty Brokerage.

Zsolt, who has 14 offices in the Greater Toronto Area, said he expects his agents to close about 500 sales at the end of this month alone.

“We usually tell buyers to try not to close in the last week of June because it’s so busy. It’s right after school and before full cottage season so they’re all in a rush. It could be a bit of a disaster,” says Zsolt.

On Tuesday the Law Society of Upper Canada issued an advisory to lawyers saying that they should make arrangements in case retail branches downtown are shuttered for security reasons.

“If you are a lawyer with a transaction that is pending, make sure you make alternative arrangements,” said Roy Thomas, spokesperson for the Law Society.

So far the policy has been in flux as banks monitor how they will be affected by the security perimeter.

“Recognizing the fact that employee and customer access will likely be impacted by summit related activity, we will be closing some branches in close proximity to the security zone,” says Ralph Marranca, spokesperson for Bank of Montreal. Marranca said no specific details on branch closings were available as yet, but some branches had been proactively reaching out to customers to advise them of any alternate arrangements.

Bank of Nova Scotia spokesperson Joe Konecny meanwhile says some branches in the downtown core would be open on Monday, Tuesday and Wednesday before the summit, but would be closed on Thursday and Friday.

“We are committed to taking all reasonable steps to provide for the continuity of business,” says Konecny. “We will adjust our business continuity plans as necessary.”

The Royal Bank of Canada, Canada’s largest bank said no closings were planned at the moment.

“There are continuity plans in place in case we have to make adjustments,” said spokesperson Don Blair.

Bob Aaron, a real estate lawyer and Toronto Star columnist, says he has written to his bank in frustration trying to figure out how the closings would have an impact on his business.

“My bank tells me I’m on my own to make arrangements for alternate banking on June 24 and June 25. That’s hardly the appropriate level of customer service,” Aaron complained to the TD Bank in a letter sent Tuesday.

Mohammed Nakhood, a spokesperson for the bank says TD was “evaluating potential bank closings” but had not made a final decision as yet. As for alternate arrangements, Nakhood says it would be “speculative” to guess what they would be at this point.

Aaron says that’s not acceptable, since lawyers would be left scrambling at the last minute to figure out how to close deals.

“There could be financial penalties and lawsuits because we have failed to close,” he says.

The summit of the top world leaders will take place in Toronto June 26 and 27, but a security zone will be in place before then. Some office towers surrounding the Metro Convention Centre will have severely restricted access as a result, with a security bill in the hundreds of millions of dollars.

Meanwhile realtor Zsolt says his wife, who works for TD Bank has been told to stay away from the office and work from home.

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Contact the Jeffrey Team for more information - 416-388-1960

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Unique Challenges For Toronto Condo Buyers In A Booming Market

October 6, 2007 Miscellaneous, New Toronto Condos & Lofts, North York Condos, Toronto Condos, Toronto Real Estate

A checklist for Toronto condo purchasers

Kathleen Waters, Vice-President, TitlePLUS
From Dream Homes & Condos Magazine

Housing markets are booming, and the Toronto condo market in particular is experiencing continued rapid growth.

Condo purchases differ in several important ways from a typical home purchase. So whether this is a first home, or the first purchase of a condo after many years of owning a detached house, buyers need to be aware of the unique aspects of a condo purchase and of the questions they need to ask to protect themselves.

Kathleen Waters, an experienced real estate lawyer and vice president of TitlePLUS, is available to discuss the specific issues affecting condos They include:

Checklist for Toronto Condo Buyers

Status Certificate – Your real estate lawyer will obtain a copy of the condominium corporation’s status certificate. It includes key information such as: details relative to common expenses, payment arrears, special assessments, any pending legal actions, insurance and any unusual additions to the common elements for your unit that have not been approved by the Board. For example, the condominium corporation may establish a special assessment (a charge beyond monthly maintenance fees) for unanticipated repairs or expenses such as a leaky roof. The added expense can be an unwelcome surprise for the new buyer.

Reserve Fund studies are an important aspect of condominium management. A prudent buyer wants to know that the condominium corporation is complying with its requirements to obtain Reserve Fund studies and that the reserve fund is currently considered adequate for future major repairs. Information regarding the Reserve Fund is contained in the Status Certificate.

Lifestyle Issues – Condo rules may have an impact on lifestyle issues, such as whether you can have a pet in your unit or a barbeque on a patio/terrace. Talk to your real estate agent and your real estate lawyer in advance about any “deal breakers” for your lifestyle.

Property Rights – Your real estate lawyer can also explain to you what sort of property rights you will have: for instance, do you actually own your storage locker or parking space, or do you just have exclusive use of them as part of the common elements?

Condominium Board Oversight/Governance – The condominium board oversees the working of the condominium corporation and has a great deal of influence over how the condominium is run. If possible, potential buyers should try and find out as much as they can about the board and the character of the building.

Realty Tax Assessment – Buyers of “nearly new” resale condos need to be especially aware of whether a separate assessment of realty taxes per unit has yet taken place. If the assessment has not yet “caught up” with the new development, buyers may find their realty taxes increase dramatically after an assessment takes place.

A real estate lawyer can work with the purchaser to determine whether the taxes for the unit have been separately assessed and make efforts to guard against the buyer being out-of-pocket for realty taxes attributable to previous owners.

Special issues for New Developments – Buyers of new condominium units are entitled to a disclosure statement from the developer of the condominium. Following receipt, there is a 10 day period when the prospective buyer can rescind or try to re-negotiate the agreement of purchase and sale. This is the time to review all documentation provided very carefully and consult with a real estate lawyer as soon as possible. It is crucial to determine if you want any detailed legal advice or negotiation services during this window of opportunity.

Buyers of new construction condos also need to be aware of whether their development has plans for “phasing”, whereby developers build new units, new common elements, or even entire new buildings, on the same site. This can involve changes for the purchaser in the overall enjoyment of the property and/or delays in access to advertised amenities. It is important to be aware of other possible implications of “phasing”.

Obtain Title Insurance Policy – Speak with a real estate lawyer about securing a title insurance policy on your new condominium. Title insurance can protect homebuyers from costs and complications in the event that something does go wrong with their new home. According to TitlePLUS statistics, a leading provider of title insurance, the majority of claims from condominium owners relate to financial matters, some of which could not have been detected before closing. But there can also be difficult problems relating to unapproved additions to the common elements (such as a balcony enclosure) and Building Department compliance issues.

A Free Guide

The TitlePLUS program has created a free Real Simple Real Estate Guide to educate home buyers on the role of a real estate lawyer and the key issues around title. The Guide also includes financial calculators, a glossary of terms, and a locate-a-lawyer tool. The Guide is available at www.titleplus.ca.

About TitlePLUS Insurance

TitlePLUS title insurance is provided by the Lawyers’ Professional Indemnity Company (LAWPROÂ®), an insurance company incorporated in 1990 by the Law Society of Upper Canada and licensed to provide professional liability insurance and title insurance in numerous jurisdictions across Canada. LAWPRO has earned an A (Excellent) financial strength rating by A.M. Best Co., a leading rating agency, for the last six consecutive years.

TitlePLUS title insurance is the only all-Canadian title insurance product on the market today. It offers home buyers insurance coverage for both title-related aspects of a transaction and the legal services provided by a lawyer. It also protects buyers and lenders under the same policy (and for the same premium) for title-related problems that could affect ownership or the marketability of the property in the future, and legal services provided by the lawyer closing the purchase.*

The TitlePLUS OwnerEXPRESSÂ® program offers current home owners protection against title-related risks and fraud.

*As with any insurance purchase, consumers should refer to the policy for full details, including actual terms and conditions. OwnerEXPRESSÂ® policies do not include legal service coverage. Â® LAWPRO, TitlePLUS and OwnerEXPRESS are registered trademarks of Lawyers’ Professional Indemnity Company.

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Contact the Jeffrey Team for more information – 416-388-1960

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Laurin and Natalie Jeffrey are Toronto real estate agents. We would be happy to help you find your new Toronto home — be it house or condo or loft. We would also be more than pleased to help you sell your current Toronto property.

Century 21 Regal Realty Inc. Brokerage
1332 Queen Street West
Toronto Ontario M6K 1L4
Office Phone: 416−849−5360
Office Fax: 416−849−8987

Laurin Cell: 416−388−1960
Laurin Email: laurin@jeffreyteam.com

Natalie Cell: 416−318−7917
Natalie Email: natalie@jeffreyteam.com

The vast majority of content on this blog is not written by Laurin or Natalie Jeffery. It is written by many different authors, for many different publications and websites.

We re-print these articles here as a collection of Toronto real estate news and information. We aim for this blog to be a one-stop shop for people looking for information on Toronto real estate.

We do not claim any of the information we did not write as our own. We do not work for any publication, nor any builder. We are Registered Real Estate Sales People working for Century 21 Regal Realty Inc. Brokerage.