LAWYERS
Talk To Your Lawyer
In Alberta, ownership of all real property, such as houses and farmland, is registered with the government at the Land Titles Office. A land title certificate is like a receipt. It shows who owns the property and who has an interest in the property.
Your lawyer will ensure that the seller’s mortgage is removed from the title and the buyer’s mortgage is added to the land title. In order to do this, the money used to transfer ownership of property must be transferred securely, and that’s where we come in. Your lawyer will handle the exchange of the land title certificate for money, so that the new owner legally owns the property and the seller gets their money.
COMPLETION DAY
WHAT IS A WALK THROUGH?
As a courtesy, the seller often allows the buyer to “walk-through” the property on the Completion Day to ensure that the property is in the same condition as at the time the buyer viewed the property.
WHAT IS A HOLDBACK?
A holdback is NOT provided for in most Residential Purchase Contracts. That said, if the Buyer and Seller are agreeable to a holdback, one may be used in circumstances where something is wrong with the property on the Completion Day. For example, a storm damages the roof of a property. In this case, a holdback may be negotiated for $5,000 to be held back (not released) to the Seller of the property until the insurance company looks at the damage. The holdback provides incentive to remedy the situation and the money may be used to fix the roof or pay for the insurance deductible if need be. If, for example, the insurance deductible is needed and it costs $1,000 then that amount goes towards the roof repairs and the remaining $4,000 is released to the Seller.
WHAT IS TITLE INSURANCE?
Title insurance is an insurance policy that is designed to protect the new buyer, the home owner, against challenges to the ownership of the property or from problems related to the owner’s title to the property. A title insurance policy provides coverage against losses due to title defects, even if the defects existed before you purchased the property. We strongly encourage you to completely understand title insurance before you purchase it, and Fee Simple Law LLP is not responsible for any title insurance policy you may buy. Please read our FAQ: What’s the difference between Title Insurance and an RPR?
PROPERTY TAX
CAN MY TAXES BE ADDED TO MY MORTGAGE PAYMENTS?
Yes, some lenders can set up a tax account and pay your taxes for you. This means your lender will collect monthly tax instalments in addition to your monthly mortgage payments. Your lender will then pay your yearly property taxes on your behalf.
RPR & LETTER OF COMPLIANCE
REAL PROPERTY REPORT - WHAT IS IT?
A Real Property Report or RPR is an overhead drawing of your property which shows the property lines and the location of all current improvements on the property, such as the house, garage, shed, deck, fences, etc. This document is important because it shows that these improvements are included with the property and are within the property lines. It also enables the municipality to review the improvements to ensure that they comply with the municipal by-laws, and that the proper permits were pulled when everything was built. This is important because, for example, should the deck not meet the building code, it may need to be removed. If there is no RPR or the RPR is not current and complete, then the purchase or sale of the property may be delayed or even terminated.
WHO PROVIDES AN REAL PROPERTY REPORT?
Most Residential Purchase Contracts dictate that the seller must provide the RPR. If you are selling your property, we highly recommend that you have an RPR prepared before you list your property for sale. This will give you plenty of time to resolve any matters that may delay the sale of your property.
DO REAL PROPERTY REPORTS EXPIRE?
RPRs do not expire. So long as all the current improvements are showing on the RPR and the Municipal Compliance is current – the RPR and Municipal Compliance should be satisfactory. However, some banks do not accept RPRs that are more than 10 years old. If you are buying, you should check with your bank to see if a new RPR with Municipal Compliance will be needed.
MUNICIPAL COMPLIANCE - WHAT IS IT?
A Real Property Reports (RPR) must be accompanied by a Letter of Municipal Compliance or a Stamp of Municipal Compliance from the town or city where the property is located. This confirms the property complies with the municipal by-laws. If there is no Municipal Compliance with the RPR, then the RPR is not complete, and the purchase or sale of the property may be delayed or even terminated.