Skip to content

Buying a Home

When someone is involved in purchasing a property in Ontario, a lawyer is required to complete the transfer. A lawyer’s work involved in a purchase varies, depending importantly on the type of property involved, and other important factors that dictate what a lawyer does or does not do.

Agreement of Purchase and Sale

An agreement for a home is typically not prepared by a lawyer. If an offer has been accepted by a seller, the buyer may or may have not included conditions for the purchase. This makes the contract to purchase the conditional on certain things taking place.

For example, if a buyer inserts a “financing” or “mortgage” condition, this usually means that the buyer may terminate the agreement if the buyer does not secure financing to purchase the property. Additionally, if the offer to purchase includes an “inspection” condition, or any other condition inserted solely for the benefit of the buyer, and the condition is not fulfilled, then the buyer may terminate the agreement.

Some agreements are unconditional; that is, no conditions exist and it becomes a “firm” and binding agreement to purchase a home if the offer is accepted by the seller. Similarly, if all of the conditions inserted in an offer to purchase a home have been waived by the buyer, then the agreement becomes “firm”.

Lawyer’s Work

Once an agreement has been “firmed up”, that is, once all conditions, if any, have been waived by the buyer, then the agreement is forwarded to a lawyer’s office.  A lawyer’s review of the agreement, and any steps taken at the outset, will be determined by what type of property is involved, and what conditions are included in the agreement.

Generally, a typical home purchase involves the lawyer conducting a title search on the property. This will determine what requests, if any, the lawyer will make of the seller and his lawyer. A lawyer has until a certain date to make these requests, and this is called a “requisition date”. This date is inserted in the agreement.

Certain requisitions made to the lawyer for the seller typically involved the discharge, of removal, of any mortgage on title, deletion of any expired restrictive convenants, declaration from sellers of full compliance of restrictive covenants, and any other items that are matters of title.

Simply put, the duty of the lawyer for the buyer is to ensure that the buyer has “good title”.

Buyer’s Work

A buyer is required to provide certain information to the his or her lawyer, which generally include legal names, dates of birth, and instructions as to how title will be taken.

A buyer is also required to sign various documents prepared by the lawyer in order to complete the transaction, and other documents that are required if the buyer is arranging a mortgage for the purchase. All of this is done prior to the closing date at the lawyer’s office.

Additionally, a buyer will typically provide the downpayment funds, legal fees and disbursements, and land transfer tax, to the lawyer prior to the closing.

Closing, Funds, and Keys

Prior to, or on the closing date, the seller’s lawyer delivers to the buyer’s lawyer the keys and the seller’s documents. On closing date, the buyer’s lawyer delivers to the seller’s lawyer the purchase funds and the buyer’s documents.

The buyer’s lawyer cannot release the keys, and the seller’s lawyer cannot disburse the funds received from the buyer’s lawyer. These are held in escrow pending the completion of the transaction.

Once satisfied, the seller’s lawyer will “release”, or sign off, on the Transfer/Deed, which then allows the purchaser’s lawyer to register the Transfer/Deed in the purchaser’s name. Upon registration, the keys may be released to the buyer, and the funds may be disbursed. The transaction is complete!

*Please note that the above does not capture the true extent of the process; it’s best that you seek the input of a law office for further information.