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Real Estate Transfers
My office assists Buyers and Sellers when buying and/or selling real estate as well as when granting mortgages to lenders for their real estate purchases or for home equity loans and attending to the release of mortgages from property. I would be pleased to be of assistance and ask that you inform your realtor, if applicable, as well as your lender's representative and contact my office as soon as possible.
The Contract of Purchase and Sale
This document is more than a receipt. When signed by both parties, it is a legally binding contract. READ IT CAREFULLY. The parties should ensure that everything that is agreed to is in writing. If you are not dealing with a real estate agent, I would be pleased to prepare a Contract of Purchase and Sale on your behalf.
Title to the Property
A Buyer should satisfy himself on matters of zoning or building or use restrictions, toxic or environmental hazards, encroachments on or by the property an any encumbrances which are staying on title before becoming legally bound. If you are taking out a mortgage, make sure that title, zoning and building restrictions are all acceptable to your mortgage company. IN CERTAIN CIRCUMSTANCES the mortgage company could refuse to advance funds. If you as a Seller are allowing a Buyer to assume your mortgage you may still be responsible for payment of the mortgage unless arrangements are made with your mortgage company.
Completion
- Buyer pays purchase price or remainder of down payment in trust to his or her notary public in trust by way of a certified cheque or money order at least one day prior to the completion date. (I will advise you of the exact amount). Buyer signs the documents.
- Buyer's notary public prepares documents and forwards them for signature to Seller's lawyer or notary public who returns documents to buyer's lawyer or notary public.
- Once in a position to proceed to complete the transaction, the Buyer's lawyer or notary public then attends to deposit of signed title documents and any mortgages in the appropriate land title office.
- Buyer's notary public or lawyer releases sale proceeds to the Buyer's lawyer or notary public office.
Costs to be Borne by Seller
- Lawyer or notary fees and disbursements
- Real Estate Commission
- Goods and Services Tax
Costs to be Borne by Buyer
- Lawyer or notary fees and disbursements
- Appraisal of property
- Fire Insurance Premium
- Sales Tax (if applicable)
- Property Transfer Tax
- Goods and Services Tax (if applicable)
LAND TRANSFER (PROPERTY TRANSFER) TAX IN BRITISH COLUMBIA
Purchasers of property in British Columbia are required to pay a Property Transfer Tax (with some exceptions and exemptions) upon registration of the land transfer documents at the Land Title Office. A Notary Public acting on behalf of the purchaser normally looks after this. The tax is calculated as 1% of the first $200,000.00 of the purchase price and 2% of the balance.
FIRST TIME HOME BUYER’S EXEMPTION FROM PROPERTY TRANSFER TAX
To qualify for the First Time Home Buyer (FTHB) exemption, the purchaser must be ALL of the following:
- a Canadian citizen or permanent resident as determined by Immigration Canada
- a person who has resided in British Columbia for 12 consecutive months immediately prior to the date of registration of the transfer, or who has filed two income tax returns as a British Columbia resident within the last six years
- a person who has never, at any time, held a registered interest in a principal residence anywhere in the world. A principal residence is defined as the usual place where an individual resides
- a person who has not previously received a FTHB exemption or refund
- fair market value of the property must not exceed a threshold of $424, 000.00 to receive a full exemption. A partial exemption is allowable for a property valued up to $25,000.00 above this threshold
- the land must not exceed 0.5 hectares (1.24 acres) in size to receive a full exemption. A partial exemption is allowable when the land exceeds 0.5 hectares (1.24 acres).
Survey Certificates
Your lender may require a survey certificate showing the dimensions of your new property and the location of your new home as well as any other permanent structures on the property. This certificate is a means of determining if there are any encroachments onto the property you are purchasing or onto your neighbour's property. The certificate also determines whether or not the setback requirements specified in the bylaws of the City or regional district in which your property is located are complied with.
Title Insurance
An alternative to obtaining a survey certificate is purchasing title insurance which is acceptable to most Lenders. With title insurance, the title insurance company insures Buyers and Lenders against loss or damage that would have been revealed by an up-to-date survey.
Possession
Buyer should make arrangements through their real estate agent or the seller directly if not dealing with a real estate agent for obtaining possession. A Seller will usually not allow a Buyer to move in before the Seller has actually received the sale proceeds.
Risk
Buyer should arrange insurance to be effective on the completion date. Seller should maintain their insurance in effect until the Seller receives the proceeds of sale.
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