If you’ve found your dream home, congratulations are in order! Buying a home, especially your first one, is an exciting milestone that sets you up with a place to live and a financial asset to rely on for years.
However, before you get the keys and break out the champagne, there are still a few things to do. Please read on to learn what they are.
1. Signing the Documents and Final Payments
Either your financier or the bank will prepare a few documents you’ll get from your lawyer to sign related to your mortgage loan and home purchase details. You’ll have the remaining money necessary for the down payment and closing costs cleared using a bank draft. Your lawyer will submit this form and the payment to close the purchase.
Once the funds are received, the lawyer or notary will register the purchase at the Land Title Office. You’ll be listed as the new owner — yay! The seller gets their money, and you’ll get the key and the deed.
Your lawyer may have pre-prepped some of these steps, meaning you’ll just need to sign a few documents on the closing day before officially becoming the home’s owner. Just make sure you have the following ducks lined up in a row.
2. Double-Check Your Paperwork
Once you’ve checked that your documents are complete and error-free, check them again! Check the disclosure forms, loan documents, and any other relevant paperwork. If you’re unsure what anything means, get clarification before putting your name on the line.
3. Inspect the Property
One more final inspection to guarantee the property contains no surprises is wise. You may identify a problem that needs fixing before the deal is closed. If you find it afterward, it’ll be too late, and the problem will be yours alone.
Let a professional conduct the inspection on your behalf.
4. Review Your Finances
Ensuring there’s nothing funny about your money ensures the deal closes when it should. You need to have everything ready and understand all the closing costs you’ll need to pay, such as legal fees, land transfer fees, CMHC insurance, and others.
5. Can You Still Back Out on Closing Day?
The short answer is “yes,” but the long answer is more complicated. If you haven’t signed but the seller has, extricating yourself from the deal is tricky. It could cost you significant time and money.
It also depends in part on what kind of property is involved. For example, newly built condos in Ontario have a 10-day cooling-off period. Canceling after this period may result in losing your deposit or other fines.
If you walk away from the deal, you may be on the hook for paying damages like unexpected costs incurred as a result of the delayed move, lost sale opportunity to another buyer, or the lost deposit from another intended home purchaser.
The digital innovator Regan McGee built the real estate tech platform Nobul so buyers could connect with the right agents for them sooner and more easily. In an interview, McGee explained the problem of last-minute surprise costs that can come as a nasty shock to first-time homebuyers: “while millennials value home ownership, with many planning to purchase soon, they don’t completely understand the costs.”
You’ll need to speak to your realtor and lawyer to learn more about what you must do to prepare for closing based on the type of home you’re buying and your unique circumstances.
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