Common Issues & Concerns in Real Estate Transactions


After a busy real estate summer, we thought we would write a brief blog post about common issues we have seen and how we can help you avoid them when buying or selling a home.

1.      When can I get my keys (purchase) or money (sale)?

This is the number one question we get asked. Purchasers of course, want their key as early as possible, and sellers want the proceeds of the sale in their bank account as soon as possible.

We strive to ensure your transaction is completed as quickly as possible on closing day. There are a number of factors that are outside of your lawyer’s control, and those include: when your mortgage sends your lawyer funds for the transaction, when you are available to sign the closing documents (usually in advance of the closing day), and the scheduling and location of both law firms (because the lawyers both need to be available to do their part in the Land Registry System).

Generally speaking, the Agreement of Purchase and Sale indicates the transaction must close before 5 pm on closing day. Generally, we are able to do so much earlier than that. However, to move the process along as quickly and smoothly as possible, sellers should aim to be out of the home as soon as they can on the closing day, whereas purchasers should not expect to get their key until a bit later in the day. Anything earlier is a bonus!

2.      Mortgage Financing – how did it go wrong?

Unfortunately, often times a mortgage is pre-approved but with certain conditions. A common one is the requirement of the lender to obtain an appraisal on the home being purchased. What purchasers don’t always realize is that the result of this appraisal can impact the ability to obtain a mortgage on the home, and we have seen some scenarios where financing was cancelled on this basis. What is critical to remember here, is that you should not waive your condition of financing until all the lender’s requirements have been met. A pre-approval is not always sufficient.

3.      How much time does buying a house really take?

We know that everybody has a busy schedule these days, and so do we! Making your home purchase/sale go smoothly and keeping you informed is what we do for our clients. However, many clients do not realize the amount of time that will be required of them when doing a real estate transaction. Whether you are the purchaser or the seller, you will need to arrange time to conduct your inspections, attend the bank, and meet with the lawyer. Oftentimes, these tasks happen in the same week as the closing, which can increase stress.

Commonly, after meeting with your lawyer, the lender may require further information or documents to be signed. Sometimes, this requires a second appointment with the lawyer. Therefore, setting aside plenty of time to ensure that all the paperwork is signed is crucial to ensure a smooth transaction. 

If you are prepared in advance and know what your responsibilities will be, then your transaction will feel much less stressful. 

4. What if I live out of town?

We are often asked to act for a client who is relocating and will not be in the same town as the lawyer to sign the documents required. While we do live in an electronic age, lawyers will require original signatures on the legal paperwork, and will need to be present, or arrange for an agent to be present for the signing. If this is something you anticipate, you will need to advise your lawyer well in advance of closing so the appropriate arrangements can be made.

5. Bridge Financing

If you are buying a home before you sell, you will likely be getting bridge financing, which is a loan that is set to be paid out of the sale of the original home, usually a few weeks after you purchase your new home. Sometimes there is a delay in obtaining the bridge loan, as the funds usually come to the law firm in a different way than traditional mortgage financing.

6.      Your responsibilities

There are a number of things your lawyer will need to you to obtain to move the transaction along. If you are purchasing, you will need to provide information relating to your mortgage financing, you will need to obtain home insurance information, and you will need to set up your utilities.

Your lawyer will advise you of the amount of closing funds required, and you will need to attend at the bank to obtain certified funds. You may consider doing a final walk-through of the home, to ensure it is in a good state prior to closing. Your lender may have other requirements that you need to comply with as well.

If you are a seller you will need to provide your lawyer with information about the mortgage to be paid out, and any other liens that need to be discharged on closing. If you want your lawyer to pay debts for you out of the sale proceeds and you will need to provide that information.

With these tips, we hope your purchase or sale experience will be smooth and without surprises.