Buying A New Condo – The Process

The Process (New Construction/Condo)

I’ve signed a long contract with the builder. What should I do next?

Step 1:

Initial Contact & Communication

  • You sign the purchase contract with the builder.  You should ensure there is a condition for financing and one for lawyer’s review OR send us a draft copy in advance if possible.
  • You send us the purchase contract to us to review.  We review the contract and provide you with our comments (by phone, email or in person).
  • If you are proceeding with the purchase, you engage us to handle the purchase.
  • We send you a detailed letter covering the following:
    • Confirmation of the major terms of the purchase contract
    • Explanation of the anticipated expenses and other costs for budgeting purposes
    • Explanation of the steps involved including our tasks and your tasks and the anticipated timing for completing the various steps
    • Information we need from you
    • Other information we’d like you to know
    • Often the closing is many months or even years away so little activity occurs until closer to the closing date.

 

Step2:

Interim Closing – The Possession Date

  • You notify the utility companies of the closing so they can arrange for a meter reading and changeover of utilities applicable to the unit (gas, electricity, cable, etc.)
  • We contact you a few days in advance to notify you how much money to bring in for the interim closing (typically the balance of your anticipated down payment), who to make it payable to, other things to bring and scheduling a meeting
  •  We meet with you before the interim closing (1-2 days before closing):
    • Photocopy your ID (a legal requirement) and your Tarion Warranty Certificate if available (obtained at pre-closing walk-through)
    • Review the financial documents for the interim closing
    • Review, explanation and signing of the interim occupancy agreement
  • We exchange cheques, keys and documents with the builder’s lawyer by courier
  • We contact you to notify you that keys can be picked up (usually at our office)
  • You can move in at that point but you are not yet the legal owner of the unit.  Nor has your mortgage been advanced.  However you do pay the builder monthly occupancy fees consisting of (a) interest on the unpaid balance of the purchase price, (b) the estimated monthly condo fees and (c) the estimated monthly property taxes

 

Step 3:

Lawyer’s Searches

  • We obtain and reviews a full search of title to the property to ensure you will obtain valid legal title to the property, free of legal defects and claims against the title.  Any problems are brought to the attention of the seller’s lawyer for them to rectify.
  • We order title insurance OR secondary searches such as zoning compliance, outstanding building permits and work orders, fire department work orders, property tax and water arrears, etc.

 

Step 4: 

Document Preparation and Co-ordination

  • We receive mortgage instructions from your lender and prepare mortgage documentation for you to sign
  • We arrange for mortgage funds to be sent to our law firm’s trust account on the day of closing
  • We prepare other documentation for the transfer

 

Step 5:

Pre-Closing Meeting

  • We contact you a few days before closing to notify you how much money to bring in for the final closing, who to make it payable to, other things to bring and scheduling a meeting
  • We meet with you before closing (usually 1-2 days before closing):
    • Photocopy your ID (a legal requirement) and buyers’ Tarion Warranty Certificate (obtained at pre-closing walk-through) if not done previously
    • Review the financial documents for the final closing (detailed summary of money coming in and going out of lawyer’s trust account)
    • Review, explanation and signing of transfer documents
    • Review, explanation and signing of mortgage documents
    • Explanation of the final closing process

 

Step 6:

Closing and Reporting

  • Mortgage funds and your money deposited to our trust account and we obtain certified cheques at our bank
  • We courier the cheques and other documents to the seller’s lawyer / receive documents from seller’s lawyer by courier
  • Electronic registration of transfer and mortgage in the Land Registry system, making the transfer of ownership complete
  • We contact you immediately to advise of closing
  • We send our final reports to you, the lender and the title insurance company (a few weeks after closing)