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[BUYING AND SELLING REAL ESTATE IN CANADA - ONTARIO]
may eventually be transferred to the heirs of the estate in accordance with the deceased's will or intestate laws of their jurisdiction. Individuals contracting regarding property must be 18 years old, not be incapable, and not be an undischarged bankrupt. If the party does not have such capacity, legal representatives such as estate trustees, attorneys under power of attorney, the Public Guardian and Trustee, the Office of the Children's Lawyer and others may be required to be a part of the transaction. Corporations must be authorized by resolution of their directors and, if required, shareholders. The purchase agreement and closing documents must accurately set out the names of offices of the signing officers. Real property in Ontario must be held by a legal person or corporation. Partnerships are not a legal person and therefore cannot hold registered title. Limited liability partnerships are formed under the Limited Partnerships Act. In limited partnerships, the only entity legally capable of holding title to the real property is the general partner. Alternatively, partnerships can use a nominee, as discussed below. A nominee or trustee, usually a corporation, may hold registered title to a property on behalf of a beneficial owner. A nominee agreement or declaration of trust would stipulate the terms on which the nominee or trustee holds the property. Nominee companies offer flexibility when there are multiple beneficial owners of real estate as it allows for a single legal title holder and, for example, new joint venturers can acquire an interest in the nominee without having to register changes at the land registry office. This is also sometimes used for privacy reasons.
Starting from May 6, 2017, it has been mandatory for most buyers to fill out an information form disclosing beneficial owners and certain other information in connection with the purchase of residential and agricultural properties. The completed form is submitted electronically to the Minister of Finance and is not made public. V. TITLE INSURANCE In both residential and commercial transactions, title insurance is a contract with a title insurer that may protect the buyer and mortgagee from possible financial losses such as:
title to the estate or interest insured being held other than as shown in the policy;
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• any title defect and charge, lien or encumbrance on the title, including defects that may have been disclosed by an up-to-date survey;
unmarketability of title;
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certain types of fraud; and
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lack or a right of access to and from the land.
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Separate owner and lender policies are available. Owner policies are generally a one-time purchase and protect a buyer for as long as they, or their heirs, hold title to the property. Similarly, a lender policy is usually a one-time purchase and effective while the mortgage loan is outstanding. An owner is not covered by a lender's policy as only the mortgagee's interest is insured. Title insurance can be beneficial in that it allows buyers and lenders to "insurer over" selected problems and may reduce legal fees as certain searches may be waived by the title insurer.
ILN Real Estate Group – Buying and Selling Real Estate Series
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