Real Estate

Buying a Home

A house is probably going to be the most expensive item you will buy in your lifetime, and it's a complicated and confusing process. It is important to consult a lawyer to protect yourself and your investment.

Other than the price of the house, there are other costs such as GST (depending on the transaction, age of the home or recent renovations), Property Transfer Tax (PTT which doesn't apply usually for first time home buyers), Land Title Registration Fees, and fees to prepare and register the mortgage.

Once you’ve found a house, you have to make a written offer. The realtor will give you a form called a contract for purchase and sale. It is a legal contract so read it carefully and discuss with your realtor any issues you have before signing. The contract contains a time limit for the seller to think about your offer, things that are included in the house such as appliances, conditions such as “subject to mortgage approval” or the sale of your current home. This will then go back to the sellers as the counter offer, and if they accept it, it becomes a legally binding agreement.

A deposit is normally 5% to 10% of the price of the home and is paid to the realtor “in Trust” meaning they will hold onto the funds for the time being. There are many different mortgage options so shop around to find which suits you and your needs best. Often a mortgage broker can provide information to help with your decision.

Your lawyer will do the appropriate searches for information such as title searches to find out if there are any charges or liens registered to the property that might interfere or prohibit your purchase.

Your lawyer will draw up the documents including transfer forms and mortgage forms which you will need to sign. There is also a Statement of Adjustments which takes into consideration expenses that are shared between you and the seller such as property tax and utilities. Your lawyer will send documents and forms to the seller's lawyer to be reviewed then back to your lawyer for registration with the Land Titles Office. On the possession date or day you can move in, the realtor will pass you the keys to your new home.

Please refer to Mortgages and Selling a Home for more information

Selling

As with buying, selling is one of the biggest transactions you'll make in a lifetime. To ensure you get the best value and price, do some research in your neighborhood to compare prices. You might want to have your home appraised professionally or consult a real estate agent on what price they might suggest you home be listed for. It is possible for you to sell your home without the help of a realtor; however, it is easier to have someone else sell it for you. Your agent has access to multiple listings which means they can advertise the sale of your home in many different places to increase the amount of potential buyers.

If someone offers to buy your home, the realtor will present you with a written offer for purchase and sale. Make sure you read the fine print and check for “subject to” clauses. Make sure you agree to the terms such as including certain appliances, You can use these as bargaining tools if you think the buyer will want them. If you have any questions or concern, ask your Real Estate Agent or consult your lawyer. If you agree to all the terms, the contract goes back to the buyer and becomes a counter offer. If they accept, it's a legally binding agreement.

Real Estate commissions are usually 7% on the first $100,000 plus 2.5% on the remaining. It is the seller’s responsibility to pay the selling realtor's commissions as well as the buyer's realty commissions.

You will have to sign documents for the transfer of ownership as well as mortgage documents at your lawyer's office before the transaction is complete.

Please refer to Mortgages and Buying a Home for more information.

Mortgages

A mortgage is a contract with a bank or mortgage company that will give you the funds to purchase your home with the assurance you will pay it back. Payments and interest rates depend upon the conditions and terms you and the financial institution agree to and can manage. However, even though your name appears on title as owner, the financial institution makes a charge against your house which means that if you don't or can't pay the mortgage payments, the bank or mortgagor, has the right to seize the property or sue you, the mortgagee.

The mortgage company will set terms such as a time period for the mortgage. They will lend you the money for a short or longer term anywhere from 6 months to 10 years. The longer the term, the higher the interest rate and at the end, the bulk of the amount is due back to the mortgage company. At this point, you can pay it if you have the funds or renew or refinance for another term. To get the best mortgage, you can consult a mortgage broker or your bank or financial institution. There are many different kinds and conditions so it's best to shop around to find a mortgage that best suits your requirements.

Mortgage companies usually require a lawyer to meet certain conditions before they will provide the funds. Your lawyer will need you to sign documents and register your mortgage with the Land Titles Office.

Role of Lawyer in Buying a New Home
http://www.hpo.bc.ca/PublicationsForms/Buying/Laywer.htm

Buying a New Home “A Consumer’s Protection Guide”
http://www.hpo.bc.ca/PublicationsForms/Buying/index.htm

Mortgage Calculator
http://www.cmhc-schl.gc.ca/calculator/mortgage_calce.cfm

Step by Step Homebuying Guide
http://www.cmhc-schl.gc.ca/en/co/buho/index.cfm

Real Estate

Buying a Home

Selling

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