Legal & Closing Costs for Home Sellers in Kits

Some of the costs you’ll encounter when you’re selling a home are the Legal Costs and Closing Costs. Read about the difference between a Lawyer and Notary in order to determine which professional provides the services you’ll need when selling your home.

LEGAL COSTS FOR HOME SELLERS

Legal fees are dependant on the situation, however, you can expect them to be around $750 (not including the cost of your legal representation). Legal fees include the costs to discharge the mortgage, prepare a statement of adjustments, land title search fees, registration fees, etc. We highly recommend you use a Lawyer or Notary – so expect to pay more in legal fees to cover their services. Feel free to shop around for professionals to get different quotes and ideas of what services they offer and their level of involvement.

The cost to use a Lawyer or Notary is money well spent. They will make the process smooth and can explain everything involved in the contract or transaction. Also, if something unexpected happens with the deal, you already have a relationship with this person and they’ll be much more prepared to help in times of need.

 

CLOSING COSTS FOR HOME SELLERS

Sometimes home sellers have already pre-paid costs towards their home that are associated with time or use after the date they will move out. These costs include strata fees, municipal taxes, water and sewer fees, security fees and for tenanted properties: rent & deposits. These costs need to be reimbursed on a pro rated basis by the Buyer on the date of completion.

For example, the Seller may pay their yearly property taxes in January, so when the Buyer takes possession at the beginning of March, they will pay the seller their 10 months worth of taxes. Since strata fees are paid monthly, and typically on the first day of the month, the Buyer will reimburse the Seller for the days that the Buyer lives in the property (i.e. if the Buyer moves in on the 20th day, they will pay the Seller 12/31 days worth of Strata fees).

Occasionally, the Buyer ends up paying for costs after they move in that should be attributed to the Seller, so these costs will be adjusted as well.

All of these cost adjustments are set out in a document called the “Statement of Adjustments” that is prepared by your Lawyer or Notary. This document identifies what home costs need to be adjusted between the Buyer and Seller, and how the Buyer will be paying for them (either from the initial deposit as stated on the Contract of Purchase, the mortgage funds, or from the money the Seller may possibly owe the Buyer). The amount of money to be paid by the Buyer to complete the transaction will be calculated at the bottom of the statement. This amount will need to be delivered to the Seller by certified cheque or bank draft a few days before completion (this is something the Buyer’s lawyer will ensure is delivered).

There are certain issues that can arise for Non-Resident Sellers, so they are especially recommended to use a professional in the closing of their home.

 

REAL ESTATE CLOSING PROCESS FOR HOME SELLERS:

  1. Contact a Lawyer or Notary for representation soon after an Accepted Offer. We can recommend a professional.
  2. Contact a Lawyer or Notary for representation soon after an Accepted Offer. We can recommend a professional.
  3. You’ll meet with the Lawyer or Notary to give them all the details of the transaction.
  4. The Buyer’s legal representation will connect with your representation to ensure all documents are forwarded and signed, and that both parties are aware of any costs, changes or issues.
  5. A few days before the Completion Date, you will meet with you Lawyer to sign all the documents and deliver any balance of funds needed to complete the purchase (typically something only the Buyer has to do, but in certain situations the Seller may have to cut a small cheque to complete the deal – this will not be a surprise to you).
  6. On the day of Completion, the Buyer’s Lawyer will register the transfer of property will forward the funds to your Lawyer or Notary.
  7. You have now sold your home!

 

Thinking of selling your Kits home? See additional information and resources below, or contact us to speak with an agent.