Does a Lawyer Handle My Mortgage When Buying a Home in Nova Scotia?

You have a mortgage approval in hand and an accepted offer on a home. Now the lender's paperwork arrives, and you wonder whether the lawyer doing your purchase is also the person who reviews, signs and registers the mortgage, or whether that is a separate job.

This article explains how the lawyer's role generally fits around your mortgage in Nova Scotia, what is registered and by whom, and which closing costs tie into registration. Lender rules differ, so treat this as a map of the process, not a substitute for your own documents.

This article covers the law of Nova Scotia.

The short answer: the lawyer usually sits in the middle

In a typical purchase, your lawyer is the person who connects three things: your purchase agreement, your lender's mortgage instructions and the public land record. Many buyers use one lawyer for the purchase and the mortgage together. Whether your lender allows that, or wants its own lawyer, is something your lender can tell you when it sends its instructions.

The province itself recommends a lawyer for real property transactions, including identifying the correct parcel identification number and matching the legal description to the parcel. A mortgage is registered against that same parcel, so getting the parcel right matters for both the purchase and the loan.

What happens at registration

Most land documents in Nova Scotia are submitted electronically, and that is done by authorized lawyers. To be authorized, a lawyer must hold a current Property Online authorized lawyer user agreement with the Minister, and the lawyer's firm must have a pre-authorized debit agreement with the Minister. Property Online is the Province's online real property information system, and lawyers must be authorized with it to e-submit documents.

A PID is a parcel identification number, and a parcel register must contain the PID assigned to the parcel. A document relating to a registered parcel may describe the land by full text, a short form legal description, or the PID for the registered parcel. In plain terms, your lawyer checks that the PID and description in your deed and mortgage match the property you are actually buying.

• Your lawyer reviews the purchase agreement and the title to the parcel.
• Your lawyer reviews the lender's instructions and the mortgage terms with you.
• You sign the purchase and mortgage documents once your lawyer has explained them and you are comfortable with them.
• Your lawyer submits the documents for registration through Property Online.

What your lender will want from your lawyer

Lenders each have their own instructions, and these are not the same everywhere. Common topics include confirming that the title is acceptable to the lender, that the mortgage ranks the way the lender expects, and that insurance and other conditions of your approval are met. Your lender will give your lawyer these instructions, and your lawyer will explain anything that affects you.

If the property is a condominium unit, ask your lawyer and lender what extra documents are needed. The province advises buyers to get the declaration, bylaws, common elements rules, reserve fund status certificate and audited financial statements before buying. For a resale unit, the province advises making the offer conditional upon receiving an estoppel certificate.

Costs that connect to registration

Several closing costs arise when the deed is registered. Municipal deed transfer tax is a separate municipal tax. Rates are set by each municipality, and the tax is collected through Land Registry when the deed is registered and recorded. Municipalities can set rates as high as 1.5 percent of the value of the property.

The purchaser must complete a Municipal Deed Transfer Affidavit of Value form when the deed is registered, so you, as purchaser, supply the information used to calculate the municipal tax. Buyers also pay a separate fee to record the deed, and HST applies to new units but not to previously owned units, although resale buyers may owe the federal portion in some cases, such as where the seller used the unit mainly for business.

If you live outside Nova Scotia, a separate provincial non-resident deed transfer tax may also apply, so tell your lawyer early about where you live.

What to do next

• Send your lender's approval letter and commitment to your lawyer as soon as you have them.
• Ask your lender whether it accepts your lawyer or requires its own.
• Ask your lawyer to explain the mortgage term, rate type and prepayment terms before you sign.
• Confirm which closing costs, including municipal deed transfer tax and recording fees, you need to have ready.
• Tell your lawyer if you are buying a condominium or if you live outside Nova Scotia.
• Have your lawyer review the agreement before you sign it, as the province advises.

A lawyer can confirm what your specific lender requires and what your closing costs will be.

Frequently asked questions