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[BUYING AND SELLING REAL ESTATE IN CANADA - ONTARIO]
1. Transfer/deed of land This document transfers ownership of the real property to the buyer, lists the consideration paid and contains the land transfer tax affidavit completed by the buyer. If the seller is an individual, the transfer must contain Family Law Act statements, which are designed to protect spousal rights of the matrimonial home. If a party is selling the matrimonial home and the spouse is not listed on title, the non-titled spouse must give consent to the transaction. Planning Act optional statements may also be included in the transfer. The buyer will advise the seller how it is taking title. 2. Statement of adjustments The statement of adjustment is prepared by the seller for the buyer and calculates the amount of money the buyer owes the seller on the closing date and will show the purchase price due to the seller and credits for any deposits already paid by the buyer. It should include an adjustment of all ongoing expenses and revenues, such as property taxes, rents and damage deposits from tenants, condominium strata fees, etc., that are due or paid by the seller prior to closing. It includes all costs up to the day before closing for the seller, and the day of closing for the buyer. An undertaking from the buyer and seller to readjust the statement of adjustments after closing for any errors discovered post-closing or for a recalculation of realty taxes once the final tax bill is issued post-closing is commonly included in the closing documents. 3. Document Registration Agreement ("DRA") – To accommodate
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bill of sale – to be delivered when chattels are being transferred to the buyer along with buildings and land; vendor take-back mortgage, if applicable;
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vendor direction as to funds;
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vendor declaration of possession;
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buyer's direction re: title;
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vendor's certificate or statutory declaration pursuant to s. 116 of the Income Tax Act ;
Commercial transactions would also use the above-noted documents, but may also require the following documents, and other documents specific to the terms of the transaction: 10. assignment and assumption of leases; 11. notice and direction to tenants; 12. assignment and assumption of warranties and guarantees; 13. assignment and assumption of contracts; 14. mortgage assumption agreement, if applicable; 15. tenant estoppel certificates (pre- closing), if applicable; 16. general conveyance; 17. purchaser's covenant to self-assess, pay HST and indemnify vendor. XV. ANNUAL PROPERTY COSTS Property owners in Ontario can expect to incur the following annual costs: 1. Realty taxes – Each property's value is assessed for municipal tax purposes under the Assessment Act and the local municipality determines the tax rates to be paid based on the assessed value. Realty taxes can be
electronic registration, the DRA outlines the terms of escrow under which the transaction is completed, including the transfer of funds and registration of documents.
ILN Real Estate Group – Buying and Selling Real Estate Series
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