Your closing day is finally here! What to expect?

Author: Sleep Easy Financial | | Categories: Mortgage Broker , Mortgage Rates , Mortgage Renewal , Mortgage Services


All home buyers and sellers look forward to the day of closing - the day where all involved parties finalize the sale of the real estate property and the keys are finally exchanged over to the excited new owners.

The closing is by nature the most complicated step of the home buying and selling process. It consists of tying together all loose ends and officially sealing the deal. We'll take a closer look at each step of the real estate closing process and provide a few helpful tips for both homebuyers and sellers.

Role of the Various Parties

‍In a real estate closing, several parties are involved which typically include a buyer, seller, real estate agent, lawyer, lender, and title company.

Buyer: The buyer is the person or entity purchasing the real estate property. The buyer's primary responsibility is to review and sign all of the necessary documents and pay the outstanding balance of the purchase price.

Seller: The seller is the person or entity selling the real estate property. The seller's primary responsibility is to ensure that the property is transferred to the buyer free and clear of any liens or debts and in accordance with the Purchase Contract.

Real Estate Agent: The real estate agent represents either the buyer or seller and has prepared and negotiated what’s commonly known as the Agreement of Purchase and Sale (or Purchase Contract)

Real Estate Lawyer: The lawyer represents either the buyer or seller and handles the legal aspects of the transaction. They review and explain all of the documents to their client(s), ensure everything is in order, and, most importantly, register the transfer of ownership with the appropriate government authorities. 

The buyer’s lawyer also conducts a title search to ensure there are no outstanding liens or debts on the property.

Title Insurer: The title insurer provides title insurance to protect the buyer and lender against any future claims or disputes.

The Lender: Unless purchased for cash, a mortgage lender provides their committed portion of the mortgage.   If a seller has an existing mortgage, their lender will receive a payout of their mortgage from the proceeds of the sale.

‍The Documents That Need to Be Signed at a Real Estate Closing

‍During a real estate closing, there are several documents that need to be signed. Here’s a list of some of the most important ones:

  • Deed of the Property: This document transfers ownership of the property from the seller to the buyer.
  • Mortgage Agreement: This document outlines all of the terms and conditions of the mortgage, including the interest rate, payment schedule, and penalties for default.
  • Statement of Adjustments: This document outlines the adjustments made to the purchase price to account for things like property taxes, utilities, and other expenses. It will be part of the amount of your total closing costs.
  • Title Transfer: This document transfers the title of the property from the seller to the buyer.
  • Mortgage Discharge: This document releases the seller from any outstanding mortgage obligations on the property.

It's essential to review all the documents carefully and ask questions if there is anything you don't understand or need clarification on. Your real estate lawyer will go over the documents with you and ensure that everything is in order before you sign them.

Funds That Need to Be Exchanged at a Real Estate Closing

‍At the real estate closing, the buyer will typically pay the balance of the purchase price (after the down payment and any deposits) to their lawyer who will remit the funds to the seller's lawyer.  The seller's lawyer will then pay any outstanding debts or liens on the property, as well as any real estate agent commissions or legal fees. Any remaining funds will be given to the seller. It's essential to make sure that you have the necessary funds available in advance to complete the purchase. Typically, this amount is between 1.5%-3% of the purchase price but can vary depending on government rebates, lender fees, and your Statement of Adjustments. Your lawyer will provide you with a detailed breakdown of the closing costs and any necessary adjustments so you know exactly how much money you need to bring to the closing.  Keys will be released after all funds have cleared and the property has been registered in the buyer’s name. Note all of this typically needs to be completed by 5 pm in the time zone the property is located.  Therefore, it is imperative you make yourself fully available on the closing day as a delay of even one extra day could end up costing you several thousands of dollars!


‍After the closing, the buyer's lawyer will register the transfer of ownership and any mortgage documents with the appropriate government authorities. This process can take several days or weeks, but once completed, the buyer officially becomes the new owner of the property.

‍The Bottom Line

‍In conclusion, the real estate closing process in Canada can be complex cumbersome and requires careful attention to detail. By understanding the steps involved, reviewing all the documents carefully, and working with experienced professionals, you can ensure a smooth and successful closing.  Best of luck on your closing day!

Important note: This article is not Legal Advice. No one should act, or refrain from acting, based solely upon the materials provided on this website without first seeking appropriate legal or other professional advice.


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