What happens on closing day, and what does my lawyer do before it?

The two weeks before: searches and requisitions

We search the parcel register under the Land Titles system for the registered owner, mortgages, easements, restrictive covenants and liens, check executions against the seller, and confirm Planning Act compliance, because a transfer that contravenes section 50 conveys no interest in land. Off-title searches cover property taxes, utilities and, where needed, work orders and zoning.

Any objection goes to the seller's lawyer in a requisition letter by the requisition date in the agreement, and the seller must answer or the deal can end. We also order title insurance: the lender policy the lender requires and, if you choose it, an owner's policy. Where the seller is married, the Family Law Act requires the spouse's consent to sell a matrimonial home.

The statement of adjustments and your closing funds

The statement of adjustments starts with the price, credits your deposit, and adjusts for property taxes the seller prepaid or owes, condominium fees, fuel, and rental contracts, all pro-rated to the closing date. For a new home it adds HST and the builder's levies.

Land transfer tax, and the Toronto municipal tax where it applies, is calculated and paid through us at registration; the first-time buyer refund is claimed there too. We add our fee, disbursements and title insurance and tell you the balance due. It must arrive in our trust account, by wire or certified funds, the day before closing; lawyers cannot accept large amounts of cash.

Signing: what the documents are

• Transfer of the land to you, with the Planning Act statements and how title is held.
• Charge (the mortgage) and the lender's standard charge terms and disclosure.
• Statutory declarations on possession, residency and, for a new home, HST and Tarion matters.
• Directions on title and funds, and an acknowledgement of the title insurance options.
• Identification verified under Law Society By-Law 7.1, in person or by approved video.

Signing usually happens two to five days before closing so the documents can be exchanged in escrow.

How the day itself runs

Documents are exchanged with the seller's lawyer under a document registration agreement: each side holds the other's documents in escrow until funds are confirmed and registration is complete. We wire the balance to the seller's lawyer, register the transfer and the mortgage electronically through the land registration system, and receive the seller's discharge of any mortgage.

Registration takes place during land registry hours, and keys are released when it is confirmed, typically in the afternoon. The final walk-through is done the day before or the morning of closing. Delays usually come from late funds, a lender advancing late, or a seller's discharge not being ready.

When something goes wrong

If the walk-through shows damage or missing chattels, the usual fix is a holdback from the seller's proceeds, agreed between the lawyers. If the seller has not moved out, vacant possession is a breach and the deal does not close until it is delivered. If a party cannot close on the day, the other side can tender to preserve its rights, and the closing is usually extended by amendment with interest or per-diem compensation. Our closing-delay action plan explains each option and the timing.