If you are selling a property (whether a primary residence or an investment property), we recommend considering the following information to ensure the transaction completes smoothly.
1. Net Sale Proceeds Payable to Vendors on Closing:
Please note that upon closing, the net sale proceeds will be available by certified cheque, payable to the registered owners of the property.
If Power of Attorney is being used to complete a sale, the net sale proceed(s) will still be payable to the registered owners and NOT the Power of Attorney.
If two or more persons are selling a property, we require you to confirm in writing (prior to closing) how the net sale proceeds will be made payable if you wish to have separate cheques for each vendor.
Should a purchaser’s deposit (which is being held by the realtor in trust until the transaction is completed), be greater than the realtor’s commission, any excess funds from such deposit will be refunded to you directly from the realtor!
2. Spousal Consent:
If the property being sold is registered in one spouse’s name, but the home is a matrimonial home, the spouse who is not registered on title must sign his/her consent on the sale closing documents.
The non-owner spouse must not only attend the appointment to sign closing documents, but must also sign a direction indicating who the net sale proceeds are to be made payable to.
The net sale proceeds may be payable to the spouse who is the registered owner, in which case we recommend that the consenting spouse obtain independent legal advice prior to signing. Otherwise, the net sale proceeds will be paid to BOTH spouses.
The above information only applies if the property being sold is a matrimonial home. It is not applicable to property that was always an investment and is owned by one spouse.
3. Cancellation of Your Existing Fire Insurance and Vacancy Over 30 Days:
Please do NOT make any arrangements to cancel your fire insurance policy until after you have confirmed with your lawyers office that your sale has officially been completed and you have received closing funds.
Also, be aware that if the property you are selling will be vacant for more than 30 days before the closing, you must advise the fire insurance company to cover the increased risk due to any vacancy.
4. If Power of Attorney is Being Used:
If you are completing the sale using a Power of Attorney (authorizing another person to sign closing documents on your behalf) all net sale proceeds will still be payable to ONLY the registered owner(s) of the property.
Any Power of Attorney being used for closing must be arranged well before closing.
Any sale being closed with a Power of Attorney will incur added legal costs.
5. If The Vendor is a Non-Resident:
If, at the time of closing, you will NOT be a Canadian resident, please contact your lawyers office to discuss sale processing for non-residents.
6. Utilities, Cable TV, etc
Prior to closing, you MUST notify all applicable departments to confirm arrangements for making final meter readings. Any such meters will be read on the closing date so that you will only be responsible for payment of utility accounts up to the date of closing.
If your property is in the City of Toronto, and you have NO water meter because you are on a flat rate payable ever 6 months, you must IMMEDIATELY advise our office regarding your prepaid water so that the proper adjustments for prepayment can be made.
If you have cable television, you MUST advise the cable company of your move. You must also arrange for the telephone service to be disconnected.
If the residence being sold is heated by oil, you MUST inform us in writing, and arrange to fill the fuel oil tank as of the date of closing, and pay for the cost of filling the tank. A copy of the final fill receipt must be given to our law office when signing your closing documents. On closing, you will be credited for the cost of a full tank of fuel oil.
If a full tank is NOT provided, a dispute might arise with the purchaser regarding the actual amount of fuel oil in the tank on closing. Filling the tank on the closing date avoids the possibility of such a dispute which may delay closing.
7. Installment Payments Due Prior to Closing and Postdated Cheques:
Please note that any Property Tax, Common Expense or Mortgage Payments falling due on a date PRIOR to the closing date MUST be paid by you before closing. Necessary adjustments will be made by your lawyers office on closing for any prepaid payments that cover a time period AFTER closing.
WARNING: Regarding auto-pay, pre-authorized chequing plans, or post dated cheques, it is your responsibility as a vendor to make certain that any such pre-authorized chequing plans are stopped at your bank for any payments falling due AFTER the closing date.
8. Required Documents from Vendors Needed to Process a Sale Closing:
In order for your lawyers office to begin processing the documents for the sale of your property, you MUST provide your lawyer with the following items, either by fax, mail, or in person:
A copy of the Transfer/Deed, which is the ownership document that you should have received when you purchased the property.
Details of any existing mortgages, including the name of the mortgage company, address and phone number, and mortgage account reference number.
Up to date property tax bills, as well as details of payments being made by you prior to the closing date, as well as the total amount of property taxes paid for the prior year.
A copy of the survey (if the property is not a condominium).
Your forwarding address and future telephone number after closing your sale.