legal information for selling
a property
Below is a list
of commonly asked questions about purchasing a property. |
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My
Real Property Report is more than 6 months old, is it sufficient?
The current Offer to Purchase only states that the Seller
needs to provide a Real Property Report showing the current
state of the improvements on the property NOT that the Real
Property Report has to be new. If the RPR you have shows
all of the improvements as they currently sit then it is
likely sufficient. Please note: a condominium unit does not
usually require a Real Property Report.
When can I expect to meet with my Lawyer?
Typically you should meet with your real estate lawyer at
least 10 days or more prior to the Completion Date. The Land
Titles system in Alberta often reaches as high as 5 full
business days for registration. This means that your lawyer
needs to deliver the documents to the purchasers lawyer with
at least that much time prior to the Completion Date.
Do I need a Real Property Report for
my condo?
Typically, you do not need a Real Property Report
when you sell a condo. However, if the condo
you are selling is what is called a "Bareland Condominium" this
is different. What you have in that case is an
interest in land, which means that the representations
in the contract are your obligation. In those
cases you will likely need an RPR. Your lawyer
should be addressing this issue with you.
When will I receive my proceeds?
Depending on how your lawyer conducts business, it is likely
that you will obtain your proceeds on the day of closing.
However, it is important to understand that in Alberta there
is the potential for delays with registration at the Land
Titles Office, which may mean that your proceeds can be a
few days late. The key for you, and your Real Estate representative,
is to ensure that your proceeds have actually been deposited
prior to you issuing funds based on those proceeds.
What is a Clearance Certificate?
A Clearance Certificate is a confirmation from Revenue Canada
that the proceeds of sale of a property by a person who is
not a resident are not to be allocated for income tax or
withholding purposes. Technically, it is required anytime
that a seller is or becomes a non-resident before the title
to their property transfers to another party. Address this
issue with your lawyer if you think it might be an issue.
What is an Estoppel Certificate?
This is a certificate that your lawyer is obligated to get
from the condominium management corporation in the month
that your deal is closing. The estoppel certificate is a
formal confirmation that acts as evidence that there are
no contributions, assessments or fees of any kind that are
overdue from you, the owner of the unit.
How do I recover my property taxes
that I paid?
Property taxes are adjusted by your lawyer in the normal
course of the closing of your deal. You will be compensated
by the buyer for any overpayments you have made on a pro
rata basis or you will be giving the purchaser a formal credit
for any underpayment of taxes that may be involved.
Should I let someone assume my mortgage?
There is no easy answer to this question but it really boils
down to whether you have a CMHC (Canada Mortgage and Housing
Corporation) mortgage. In Alberta virtually any mortgage
is assumable but recent changes to the Banking Act require
the individual intending to assume the mortgage be pre-qualified
by the lender. However, you as the Seller are liable if that
party does not fulfill what were your obligations. There
is no surefire way to avoid this liability no matter what
you are told. Contact a lawyer to review all of the issues
that are involved prior to agreeing to let someone assume
your mortgage.
Who pays the Realtors?
The Seller in the current contract is responsible for paying
all Real Estate commissions. When you signed the Listing
Contract, you have directed that the commissions will be
paid from the proceeds of sale. Your lawyer will use your
sales proceeds to pay outstanding amounts as part of the
closing process.
I am selling and buying the same
day. Is that an issue?
You need your cash portion of your closing amount at least
1 week prior to the closing date. This means that you may
need to arrange interim financing with your bank if you are
relying on the proceeds from the sale of your existing property
to close your new home purchase. Simply raise the issue with
your mortgage specialist or bank.
Reprinted by permission from LeClair Thiebault and www.calgarylaw.com
Susanne Harvey |
phone: 403.862.4911 | susanne@theperfectpad.com
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