Congratulations, you have decided to purchase your first home. Although this milestone can be very exciting, the home-buying process can also be a daunting experience. Mapping out the journey beforehand can help a great deal. It is essential that you retain a lawyer who specializes in real estate and who can guide you throughout the process.
YOU WILL NEED TO PAY CLOSING COSTS
Remember, upon the closing of your property, a buyer is required to pay certain closing costs. You must be able to access sufficient funds to pay these closing costs.
Closing costs include:
- Legal fees and disbursements;
- Land Transfer Tax (Municipal and Provincial Land Transfer Tax);
- Title Insurance;
- Property and Fire Insurance;
- Home inspection costs;
- Interest adjustments; and
- Other adjustment costs.
If you intend to fund your new purchase with a loan from a mortgage lender, ensure you obtain preapproval before or during the home-buying process. An agreement of purchase and sale can be conditional on a buyer obtaining satisfactory mortgage funds to complete the transaction. Failure to pay the purchase price on closing can result in the vendor terminating the transaction, seek forfeiture of the deposit monies and commence an action for damages suffered.
YOU MAY BE ELIGIBLE FOR THE FIRST-TIME HOME BUYER INCENTIVE
The First-Time Home Buyer Incentive enables first time home buyers the opportunity to reduce their monthly mortgage payment without increasing their deposit.
You must meet the following criteria to qualify:
- must meet the minimum down payment requirements;
- your income cannot be more than $120,000
- your total borrowing is limited to four times the qualifying income
IF YOU ARE A NON-RESIDENT OF CANADA, DON’T FORGET THE NON-RESIDENT SPECULATION TAX
Non-residents of Canada that purchase property are subject to a 15% Non-Resident Speculation Tax (“NRST”) on the purchase of a residential property if they live in the Greater Golden Horseshoe Region. This includes the City of Toronto, York Region, and Peel Region, in addition to other regions in Ontario.
There are exceptions for some non-residents, where they would be exempt from paying the NRST. If the non-resident is not eligible for an exemption to the NRST, there are also rebates for which some non-residents can apply. However, obtain legal advice first to ensure you are staying compliant.
FIND A REAL ESTATE LAWYER THAT YOU TRUST TO DECREASE THE RISK OF POTENTIAL PROBLEMS
Retaining the services of a real estate lawyer will help reduce the risk of potential problems on closing. Among other things, a real estate lawyer will clarify your obligations as expressed in the agreement of purchase and sale, search title to the property for any unwanted encumbrances and explain the contents of all documentation to be signed on closing.
Ultimately, lawyers who specialize in real estate can offer you peace of mind during the home buying process.
If you would like more information or legal advice regarding the home buying process, please contact real estate lawyer, Louis Gasbarre at 416.446.3318 or firstname.lastname@example.org
“This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”