Closing Day

Closing day is the day you get the keys and take legal possession of your new house or condominium.

On closing day:

  • The lender provide the mortgage funds to your lawyer
  • The lawyers for the Buyer and Seller exchange legal documents, funds and keys
  • Your lawyer registers the transfer, confirming the ownership change and that the property is now in your name
  • Your lawyer will also register the Charge or Mortgage securing the Lender’s interest on the property
  • You will receive the keys from your lawyer’s office or if the property is newly constructed from builder’s representative located at the construction site trailer, or condominium management office.

On the closing day our office will make every effort to close your transaction as soon as possible. However, there are many factors beyond our control, that effect the closing time your transaction closes, such as how early in the day we receive the funds from the lender.

Provincial Land Transfer Tax

This is a tax payable only by the Buyer, the Seller does not pay any Land Transfer Tax. The amount of tax paid depends on the purchase price, and whether you and your co-buyer and your spouse if you are married, are first time buyers.

Toronto Municipal Land Transfer Tax

This distinctive fee mirrors the Provincial Land Transfer Tax but exclusively pertains to properties nestled within the vibrant city of Toronto. It stands as an additional contribution, augmenting the Provincial Land Transfer Tax.

Title Insurance Fee

Title Insurance serves as a safeguard for both the Buyer and the Lender against potential challenges that may arise post-closing and were unknown at the time of acquisition. These challenges encompass a spectrum of issues such as zoning complications, title unmarketability, absence of necessary construction permits for prior property modifications, outdated surveys, outstanding property taxes and water bills, and the unsettling prospect of post-closing title fraud and forgery. In the unfortunate event of identity theft leading to the fraudulent sale of your property or the registration of a deceitful mortgage, the title insurance company steps in to cover your legal expenses, ensuring you are restored to the rightful position you held before the occurrence of fraud.

Closing Adjustments

The purchase price is subject to meticulous adjustments between the Buyer and the Seller, particularly concerning property taxes and common elements expenses like maintenance fees in the case of condominium purchases. In instances where the Vendor has preemptively settled or overpaid any associated services or fees related to the property, they are entitled to a credit as outlined in the Statement of Adjustments. Conversely, if there are underpayments, the credit is directed towards the Buyer, leading to a reduction in the purchase price commensurate with the adjustment amount. Our office is committed to providing you with precise details regarding these closing adjustments promptly upon receiving information from the Seller's lawyer and completing thorough searches.

Provincial Sales Tax (PST) on Mortgage Insurance

If the Buyer's down payment is less than 20%, the bank takes a strategic approach by deducting the Canada Housing and Mortgage Corporation (CMHC) Insurance premium along with the Provincial Sales Tax (PST) on the insurance from the mortgage advance. While the Lender increases the loan amount to accommodate the CMHC or Genworth mortgage insurance premium, it's noteworthy that they do not cover the PST on the insurance. Consequently, the PST on the insurance premium is subtracted from the fundamental loan amount. Additionally, certain banks may implement a holdback, reserving funds for potential property tax payments on the subject property if they assume responsibility for this aspect.

Legal Costs and Disbursements

The legal costs associated with your transaction hinge on the extent of legal work required to finalize the process. Disbursements, on the other hand, represent out-of-pocket expenses incurred by our office on your behalf to facilitate the completion of your transaction. These may encompass various items such as title searches, execution searches against both the Buyer and Seller, conveyancing costs, courier charges, bank wire transit fees, cheque certification charges, and the applicable Harmonized Sales Tax (HST) on legal fees and disbursements. It's essential to note that legal costs can vary among different law firms, given that lawyers may levy differing amounts for their services. To enhance transparency and provide clarity, our office employs a fixed fee structure for the most common types of purchase transactions. This enables us to furnish you with a written quote well in advance of your purchase, ensuring that you are well-informed about the anticipated costs associated with our legal services.

The good news is that not all the costs listed above apply to all transactions and most of them are one-time costs. For an accurate assessment of your potential closing costs please contact our office