From Accepted Offer to Closing
The Home Buying Process: Step by Step
Once your offer has been accepted, several important steps must be completed before you receive the keys to your new property. Understanding the process can help you feel confident and prepared throughout the transaction.
Accepted Offer and Deposit
After your offer is accepted, a legally binding Agreement of Purchase and Sale is created. In most cases, the buyer will provide a deposit, which is held in trust according to the terms of the agreement until closing.
It is important to:
- Keep copies of all documents, disclosures, and correspondence related to the transaction.
- Review all terms and conditions carefully.
- Meet all deadlines outlined in the agreement, including financing, inspection, and other conditions.
- Stay in regular communication with your REALTOR®, lender, and lawyer throughout the process.
Your real estate professional will help coordinate each step and ensure you remain informed from acceptance through closing.
Working With a Real Estate Lawyer
In Ontario, a real estate lawyer plays a critical role in the closing process. Your lawyer will:
- Review the Agreement of Purchase and Sale.
- Conduct title and ownership searches.
- Verify any registered easements, rights-of-way, or encumbrances affecting the property.
- Arrange the transfer of funds.
- Calculate closing adjustments and costs.
- Register the transfer of ownership.
- Ensure legal documents are completed accurately.
Your lawyer will also explain your rights and obligations as a buyer and answer any legal questions you may have.
Home Inspection
Although not always required, a professional home inspection is strongly recommended for most residential purchases. A qualified home inspector can identify potential issues with the property’s structure, roofing, plumbing, electrical systems, insulation, and other major components.
Depending on the results of the inspection:
- The transaction may proceed as planned if no significant concerns are identified.
- The buyer and seller may negotiate repairs or other adjustments if issues are discovered.
- If a home inspection condition exists within the agreement, the buyer may have options available based on the inspection findings.
For specialized concerns, additional inspections may be recommended, such as roofing, foundation, environmental, or septic system assessments.
Financing and Mortgage Approval
If your purchase is subject to financing, your lender will complete the final review of your mortgage application. During this stage, you may be asked to provide additional documentation regarding your income, employment, assets, or liabilities.
The lender may also arrange for a property appraisal to confirm the home’s market value. The appraisal helps ensure the property supports the amount being financed.
To avoid delays:
- Respond promptly to lender requests.
- Avoid taking on new debt before closing.
- Avoid changing jobs or making major purchases during the approval process.
- Stay in contact with your mortgage professional until funding is confirmed.
Condominium and Status Certificate Review
If you are purchasing a condominium, your lawyer will typically review the Status Certificate and related condominium documents. These documents provide important information about:
- The condominium corporation’s financial health.
- Monthly fees and reserve funds.
- Rules and regulations.
- Potential legal issues or special assessments.
A thorough review can help you understand your responsibilities as a condominium owner before closing.
Home Insurance
Most mortgage lenders require proof of home insurance before closing. It is advisable to obtain insurance quotes early in the process to ensure coverage is in place when required.
When comparing policies, consider:
- Coverage limits and deductibles.
- Protection for personal belongings.
- Liability coverage.
- Additional protection for water damage, sewer backup, or other regional risks.
Shopping around and comparing policies from multiple insurers may help you find the coverage that best fits your needs and budget.
Final Closing
In the days leading up to closing, your lawyer will provide a statement outlining the funds required to complete the purchase, including your down payment balance, land transfer taxes, legal fees, and other closing costs.
On closing day:
- Mortgage funds and purchase funds are transferred.
- Ownership is legally transferred to the buyer.
- The transaction is registered with the appropriate land registry office.
- Keys are released according to the terms of the agreement.
Congratulations—you are now the owner of your new home.