What happens on closing day, and when do I get my money?

Signing before closing

About a week before closing we meet, in person or by video where the rules allow, to sign. You will sign the transfer, the statement of adjustments, a direction telling us where to send your money, declarations about residency and the matrimonial home, and undertakings to the buyer's lawyer, for example to obtain the discharge of your mortgage. Bring two pieces of government identification for each owner.

If a spouse who is not on title must consent, they sign at the same meeting. If someone signs under a power of attorney or as estate trustee, the authorising document is registered with the transfer.

The statement of adjustments

The statement of adjustments is the account between you and the buyer as of the closing date. The price and the deposit are the starting point; then everything paid in advance or in arrears is settled to the day. Property taxes you have prepaid come back to you; taxes you owe are deducted. Condominium fees, fuel oil, rental contracts the buyer assumes, and rent and deposits if the home is tenanted are all adjusted.

The buyer's lawyer prepares it from figures we supply. We check each line against the tax bill, the condominium statement and the rental contracts before you sign.

Paying out the mortgage

Your lender's payout statement tells us what is owed on closing day. From the buyer's funds we pay the lender in full, and the lender then registers a discharge of its charge, the document that removes the mortgage from title. The Land Registration Reform Act and the Land Titles Act govern the form and registration of that discharge.

Because most lenders register the discharge days or weeks after being paid, we give the buyer's lawyer a written undertaking to obtain it and we follow up until it is on title. A line of credit secured on the home must be closed, not merely brought to zero, or the lender will not discharge it.

Registration and the keys

Ontario transfers are registered electronically through the land registration system operated with Teranet. We do not release the transfer for registration until the buyer's money has arrived in our trust account, and the buyer's lawyer does not send the money until the documents are in place. Once registered, we release the keys to the buyer's lawyer.

If funds are delayed, the lawyers may agree to close in escrow, holding documents and funds under conditions until the last piece arrives. You must give vacant possession as the agreement describes: empty, reasonably clean, with fixtures in place and the agreed chattels left behind.

Where the money goes

From the price, less the deposit already held by the brokerage, we pay the mortgage payout, the balance of commission with HST, our fee and disbursements, and any adjustment owed to the buyer. The rest is your net proceeds. We send them by wire or certified cheque according to the direction you signed, normally the same day as registration.

The seller does not pay land transfer tax; that is the buyer's cost. Your reporting letter, sent shortly afterwards, sets out every figure and is the document your accountant will want.