To help clients understand a lawyer’s role in a real estate purchase, Michael Dupuis sometimes compares the process to a wedding. The realtor, broker, movers and decorator are all service providers dedicated to making you happy, similar to the wedding planner, caterer and honeymoon travel agent. Meeting the real estate lawyer to sign the closing documents for your deal is like the moment you say ‘I do.’
“It’s a different attitude — it’s serious! This is the moment when it all comes together, where everything counts,” says Dupuis, associate lawyer at CBM Lawyers.
3 tips for a smooth home purchase
1. Be your own advocate
You’ll rely on a number of professionals to buy your home, but when the dust settles, you’re the one liable under the purchase contract, you’re the one who owns the property, you’re the one who is responsible for a mortgage.
“There’s a lot of pressure to move quickly, but it’s important to take the time you need. There are no dumb questions — when there’s so much on the line, the only bad question is the one that doesn’t get asked.”
2. Timing is everything
A purchase offer is a legal contract, and once it’s signed it is binding upon you and there’s not a lot a lawyer can do, if anything, to change the deal. That means the time to negotiate and consult with a lawyer is before you sign. Don’t hesitate to include subjects (subject to financing, subject to inspection, subject to title review, subject to insurance, subject to obtaining advice from a lawyer) — subjects are your only chance to get out of a contract.
“Make sure you give yourself enough time to complete the deal — there’s quite a lot of formality amongst the land title office, the law society, the bank, and each has their own requirements by which lawyers must abide. Most of that work is done between the professionals you hire, but the client can help by scheduling enough time for closing and continuing to check in to make sure everyone’s fulfilling their duties on time,” Dupuis says. Dupuis notes the following advice:
- Avoid same-day completion for sale and purchase – transactions typically complete in the afternoon and if there is any delay in your sale completing, any delay in the buyer’s lawyer sending your lawyer money, that will delay your purchase completing and may risk your purchase not completing.
- Many forms can now be signed remotely, but closing documents must be signed in person — make sure you’ll be able to visit your lawyer just before when the purchase closes because you cannot electronically sign land title documents.
- Make sure you will have with you for closing valid, unexpired government identification that shows both your photo and signature – sometimes people do not have this with them for closing (e.g. turned in their id for renewal), complicating our requirement to identify clients for both law society and banking purposes.
- Attend to finalizing your mortgage as soon as possible – we prefer to receive instructions from your lender at least one week, preferably two weeks, before completion and any delay from your bank to send us instructions will delay document preparation and our ability to meet with you and in turn risk your ability to complete your purchase (further note that like the contract, your lawyer cannot unilaterally change your lender’s instructions).
- If any funds you need for completing your purchase are not easily accessible (e.g. tied up in investments or are with a virtual bank), commence the process to obtain those funds well in advance of closing.
3. Expect the unexpected
Organize your documents and set aside funds for extra costs — every purchase includes a few bumps.
“One of those unexpected costs can be GST, which residential real estate contracts seldom discuss in detail. The general rule of thumb is that brand new homes have GST and used homes don’t, but some used-home situations can trigger GST. A subdivided property, a property used for business or a home rented out as a vacation rental can all trigger GST,” Dupuis says. “Investigate ahead of time, and if possible confirm the GST status in the contract, so your lawyer doesn’t have to be the bearer of bad news.”
Are your documents sufficient for your needs? Not all power of attorney documents are properly written, for example, so if you’re relying on one to complete a transaction you should have it reviewed and registered with the Land Title Office in advance of signing any contract (the Land Title Office has its own particular requirements).
“Some banks won’t allow you to use power of attorney to receive a mortgage. Don’t take that document for granted, and check ahead of time to avoid unnecessary stress.”
Organization is Key
A good lawyer should also expect the unexpected.
“We want to help as many people as we can, but we’re not going to bite off more than we can chew because we want to give fair attention to our existing clients. In striving to provide good service we appreciate the timely contributions from realtors, bankers, stratas and insurers. As well, file organization and a dedicated staff of legal assistants are key to providing good service - thank you as always to my assistants.”
To make an appointment with the CBM Lawyers Real Estate Law team, email info@cbmlawyers.com, call 604-256-5951 or visit cbmlawyers.com. Find CBM Lawyers in Langley at 4769 222 St.
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