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{{Dial-A-Law Blurb}}
{{REVIEWEDPLS | reviewer = [https://www.ganapathico.com/our-team/nathan-ganapathi/ Nathan Ganapathi] and [https://www.ganapathico.com/our-team/anna-kurt/ Anna Kurt], Ganapathi Law Group |date= October 2017}} {{Dial-A-Law TOC|expanded = home}}
Buying a home is an exciting life event. Learn the key factors to consider before you make an offer, and the steps involved in buying a home in British Columbia. 


{{Dial-A-Law TOC|expanded = housing}}
==What you should know==
This script covers buying a house. If you’re buying a condominium or townhouse, also check script [[Buying a Condominium (Script 407)|407]], called “Buying a Condominium”.


==Should you have a lawyer?==
===Using a real estate agent===  
A house is often the most expensive thing you’ll ever buy, and buying a house is complicated. The potential for disaster is high, and one mistake can cost a lot. As well, there are risks in real estate, and when buying or selling, you must be careful. For example, people can:
You may decide to look for a home on your own or you may use a professional to help you. There are advantages to working with a '''real estate agent'''. Agents can help you clarify the type of home you need and can afford. They are connected to networks of potential sellers and can help arrange appointments to view available properties. And they can help you navigate a complex process by:
#use a false identity to pretend they are the true owner of a property and sign documents fraudulently.
#sell the same property several times in back-to-back transactions to falsely inflate its asking price.


These are just two examples of many possible types of real estate fraud. To protect yourself, you should use a lawyer instead of trying to buy or sell a home yourself.
* explaining the forms used and helping you make a written offer to purchase
* presenting your written offer to the seller
* explaining the steps to complete the purchase after the seller accepts your offer


==Be careful—there are many other costs besides the purchase price==
As well, keep in mind the seller typically pays both realtors (the seller’s realtor and the buyer’s realtor) from the sale proceeds after selling their home.
There are many extra costs when you buy a house.


*'''Property purchase tax (PPT)'''—you may not have to pay PPT on your [http://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/understand/first-time-home-buyers first home]. [http://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/understand/first-time-home-buyers Other exemptions] also exist. For more information, call the Property Transfer Tax office of the BC government in Victoria, at 250.387.0604. Outside Victoria, call Enquiry BC at 604.660.2421 in Vancouver and 1.800.663.7867 elsewhere in BC and ask for the Property Transfer Tax office.
===The money you will need===
:PPT is calculated as follows:
Before you start looking for a new home, it’s important to consider how much you can afford to pay. This will allow you to spend your time looking at homes in your price range.
:*1% of the first $200,000 of the property’s fair market value, plus
:*2% of the rest of the property’s fair market value, up to $2,000,000, plus
:*3% of amounts over $2,000,000


*'''[http://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/understand/additional-property-transfer-tax#gvrd Foreign buyer’s tax] of 15%'''—if you are not a Canadian citizen or permanent resident, you must also pay another 15% tax on property in the Greater Vancouver Regional District. There is an [http://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/understand/additional-property-transfer-tax#exemption exemption] under the [https://www.welcomebc.ca/immigrate-to-b-c/b-c-provincial-nominee-program BC Provincial Nominee Program] (which lets high-demand foreign workers and experienced entrepreneurs become permanent residents in BC).
Almost everyone who buys a home borrows some of the money needed to pay for it. The cash you can apply towards buying a home is called the '''down payment'''.


*'''[https://www.canada.ca/en/services/taxes/gsthst.html Goods and Services Tax] (GST) of 5%'''—this applies to the purchase price of all newly-constructed or substantially renovated homes and to most legal fees and other costs of selling or buying a home.
Obtaining a loan to borrow the rest of the money typically involves signing a document called a '''mortgage'''. This document sets out the terms and conditions for the loan and its repayment. If you fail to meet your obligations under the mortgage, the lender may have the right to take your home to pay off what you still owe.


*'''[http://www2.gov.bc.ca/gov/content/taxes/sales-taxes/pst Provincial Sales Tax] (PST) of 7%'''—this applies to most legal fees and other costs of selling or buying a home.  
The easiest way to learn how much money you will be able to borrow as a mortgage loan is to meet with one or more financial institutions. These lenders will look at your family’s current income and debts and do a credit check to decide how much they will lend to you.


You will have to pay many thousands of dollars in taxes, legal fees, and other costs beyond the purchase price. Before you make an offer to buy a house, decide if you can afford both the purchase price plus all the other costs.
For more, [[Mortgages and Financing a Home Purchase|see our information on mortgages and financing a home purchase]].


==Do you need a real estate agent, or realtor? Who pays the realtor?==
===The costs of buying a home (other than the purchase price)===
You may decide to look for a house yourself or you may use a professional to help you. If you decide to use a real estate agent, pick one that you trust and who you’re comfortable with. The seller pays both real estate agents, the one for the seller and the one for the buyer. If there’s no sale, there’s usually no commission paid to the agent. If you don’t use an agent, good places to start looking for houses are local newspapers and the [http://www.mls.ca/ multiple listing website].
A home is often the most expensive thing you’ll ever buy. Yet the purchase price is not the end of it. There are many extra costs when you buy a home, in legal fees and other transaction costs, and particularly in '''taxes'''.


==Your offer to buy must be in writing==
====Property transfer tax====
If you find a house you want to buy, you must make a written offer to buy it. Verbal offers and agreements for land may not be valid. The realtor provides the form, usually from the local real estate board. This form is called a contract of purchase and sale. Read it carefully, because this contract is legally binding. If there’s anything in it that you don’t like or doesn’t apply, cross it out with a pen, then initial the change and get the seller to initial the change as well.
When you purchase property in BC that is registered at the land title office, you're responsible for paying '''property transfer tax'''. You pay the tax based on the purchase price of the property. The tax rate is:


==What should you include in the offer?==
* 1% on the first $200,000 of the price,
#Give the seller a time limit to accept your offer—normally a day or two. If the seller doesn’t accept it by then, your offer expires, allowing you to contract with someone else.
* plus 2% on the rest of the price up to $2,000,000,
#If there are things in the house you want the seller to include in the price—such as appliances, curtains, mirrors or chandeliers—add a sentence that the purchase price includes these items and make sure each item is listed. Check script [[ling Your House (Script 405)|405]] for a description of “fixtures” and how they affect the purchase or sale of a house.
* plus 3% on amounts over $2,000,000,
#You might want to make your offer conditional on the house passing an inspection by a professional building inspector. Use a “subject to” clause to do this—a lawyer can help you with the wording. While the seller usually gives you a “Disclosure Statement” listing any potential problems the seller knows about, you might still want your own inspector.
* and, for a residential property, another 2% on amounts over $3,000,000
#If you must sell your own home before you can buy the new one, make your offer conditional on selling your current house by a date that you set.
#If you need a mortgage, make your offer “subject to” (or conditional on) getting satisfactory financing, even if the bank has already “pre-approved” a mortgage amount.
#Include a statement saying the offer is “subject to” your lawyer’s approval, so your lawyer can check the offer before it becomes a binding contract.


==How much should you pay as a deposit?==
If you’re purchasing your first home, you may qualify to reduce or eliminate the amount of property transfer tax you pay. There are other exemptions as well. For details, [https://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax see the BC government website].
When you make an offer, you’ll have to make a deposit, which you’ll want to keep as low as possible. The normal deposit is 5% to 10% of the purchase price, which should be paid to the realtor in trust, not directly to the seller.


==What if the seller makes a counteroffer?==
====Other taxes====
The seller may accept your offer, or may cross out some of your terms and add new ones. Once the seller changes your offer in any way, it becomes a new offer by the seller known as a “counteroffer.” The counteroffer cancels your original offer. You must then decide if you want to accept the counteroffer or make a counteroffer of your own to the buyer. You do not have to accept a counteroffer.
Other taxes apply in certain circumstances.


==What do you need to get a mortgage?==
If you are a '''foreign national''', you must pay an '''additional property transfer tax''' of 20% if the property [https://www2.gov.bc.ca/gov/content/taxes/property-taxes/property-transfer-tax/additional-property-transfer-tax is within specified areas of BC]. These include Metro Vancouver, Greater Victoria, Fraser Valley, Central Okanagan, and Nanaimo.
As soon as you and the seller have signed an offer or counter-offer, you should begin the process of obtaining mortgage, if you require one. Shop around to get the best terms, and promptly give the mortgage company any documents and information it needs. Usually, a mortgage company will need an appraisal of the house before it promises to give you the mortgage. Often, this appraisal will be done at your own expense. The mortgage company may need a survey certificate showing that the house is within the property boundaries, or “title insurance”, before the date when the property transfers from the seller to you and you become the owner, known as the “completion date”.


Once you’ve arranged your financing, ask the mortgage company to give you a written commitment letter promising to give you the mortgage. The lawyer preparing your mortgage can often perform your legal work for the purchase as well.
'''Goods and services tax''' (GST) of 5% applies to the purchase price of all newly-constructed or substantially renovated homes. GST also applies to most legal fees and other costs of buying a home.


==What about title searches and insurance?==
'''Provincial sales tax''' (PST) of 7% applies to most legal fees and other costs of buying a home.
Your lawyer can do a title search. The search will show the registered owner of the property and any charges, such as mortgages, liens, or easements, registered against it. Any existing mortgages and liens will have to be paid off by the seller before you buy the house.


Also, talk to your lawyer about when you should get fire and liability insurance on the house and how much you should get. The mortgage company will require proof of this insurance.
===Making an offer to purchase===
If you find a home you want to buy, you must make a written '''offer''' to buy it. Verbal offers and agreements for land may not be valid. A realtor can provide a form, usually from the local real estate board, called a '''contract of purchase and sale'''. Read it carefully, as this offer can lead to a legally binding contract. If there’s anything in it you don’t like or doesn’t apply, cross it out with a pen, then initial the change. Get the seller to initial any change as well.


==When do you remove the subject-to clauses?==
====What to include in the offer====
When you’re satisfied with the results of the subject-to clauses or conditions—for example, the house inspection is fine and you’ve arranged a satisfactory mortgage—you should give written notice to the seller that you’re removing the conditions. Once you do this, the offer or counter-offer becomes a legally binding contract. There is no cooling-off period to change your mind and cancel the contract.
Give the seller a '''time limit''' to accept your offer — normally a day or two. If the seller doesn’t accept it by then, your offer expires, allowing you to make an offer to someone else.


But if you can’t meet the conditions and don’t remove them, the contract ends and you don’t have to buy the house.
When someone sells a home, all the '''fixtures''' go along with it. Generally, a fixture is anything that’s attached to the home to the point where removing it would damage the home or require repair. The bathroom sink is an obvious example. The appliances — such as the washer, dryer, fridge and stove — '''are not''' fixtures. It’s best to specifically list in the offer anything that might be thought to be a fixture, that you want the seller to include in the sale — such as appliances, curtains, mirrors or chandeliers. Add a sentence that the purchase price includes these items and make sure each item is listed.


==What is the statement of adjustments?==
You might want to make your offer conditional on the home passing an inspection by a professional building inspector. To do this, you can use a '''subject to clause''', which spells out a condition that must be met before a sale proceeds. While the seller usually gives you a disclosure statement listing any potential problems the seller knows about, you might still want your own inspector to look at the home.
Before the completion date, your lawyer will give you a document called the statement of adjustments. This document shows all money coming in and going out. It covers things that you and the seller share, such as property tax. The most important figure for you is the amount you need by the completion date. This is the money you must pay, in addition to your mortgage.


==How do you finish the purchase?==
You can also use a subject to clause if you must sell your own home before you can buy the new one. You can make your offer conditional on selling your current home by a date you set.
Normally, your lawyer prepares the transfer documents and sends them to the seller’s lawyer. The seller signs the documents and the seller’s lawyer returns them to your lawyer. Then, when your lawyer has your money and the letter promising the mortgage amount, your lawyer registers the transfer documents and the mortgage with the Land Title Office. When the Land Title Office confirms the registration, and the mortgage company has given your lawyer the mortgage money, your lawyer gives the money to the seller’s lawyer, who gives the net amount to the seller. (If the seller is a non-resident, their lawyer must withhold part of the money and send it to the Canada Revenue Agency and get a clearance certificate from it. That could take several months.) The realtor usually gives you the keys to the house once the registration is finished.


==More information==
If you need a mortgage, you can make your offer subject to getting satisfactory financing. This is wise even if the bank has already pre-approved a mortgage amount, just in case.
*Read the booklet called “[http://www.recbc.ca/consumer/buyinghome.html Buying a Home in BC Information Booklet]” prepared by the [http://www.recbc.ca/ Real Estate Council of British Columbia].
*For more information on mortgages, check script [[Mortgages and Financing a House Purchase (Script 408)|408]], called “Mortgages and Financing a House Purchase”.


You may consider a statement saying the offer is subject to your lawyer’s approval, so you can have a lawyer check the offer before it becomes a binding contract.


====How much to pay as a deposit====
When you make an offer, you’ll have to make a '''deposit''', which you’ll want to keep as low as possible. The normal deposit is 5% to 10% of the purchase price. The deposit should be paid to the realtor in trust, not directly to the seller.


[updated October 2017]
===If the seller makes a counteroffer===
The seller may accept your offer, or may cross out some of your terms and add new ones. If the seller changes your offer in any way, it becomes a new offer by the seller known as a '''counteroffer'''. The counteroffer cancels your original offer. You must then decide if you want to accept the counteroffer or make a counteroffer of your own to the buyer. You do not have to accept a counteroffer.


'''The above was last reviewed for accuracy by Nathan Ganapathi and Anna Kurt, and edited by John Blois.'''
===Hiring a lawyer===
Buying a home is a major expense and a complicated process. As well, there are risks of very bad things happening when buying real estate, if you’re not experienced and watchful. For example, people can:


----
* use a false identity to pretend they are the true owner of a property and sign documents fraudulently
----
* sell the same property several times in back-to-back transactions to falsely inflate its asking price


These are two examples of '''real estate fraud'''. To protect yourself, you should consider using a lawyer to advise you through the process of buying a home.
==The process to buy a home==
===Step 1. Decide if you are hiring a real estate agent===
Decide if you are going to look for a home on your own or hire a real estate agent.
If you decide to use a realtor, pick someone you trust and are comfortable with.
If you decide to look for a home on your own, good places to start looking are local newspapers and the internet, where there are [https://www.rew.ca/ various listing websites].
{| class="wikitable"
|align="left"|'''Tip'''
[https://www.canlii.org/en/bc/laws/stat/sbc-2004-c-42/latest/sbc-2004-c-42.html Under the law in BC], real estate agents must be licensed. [https://www.recbc.ca/about/licensee-search.html You can use the licensee search from the Real Estate Council of BC] to see if an agent is currently licensed.
|}
===Step 2. Make an offer===
When you find a home you want to buy, make an '''offer to purchase'''. A realtor can help you write up the offer on the local real estate board’s '''contract of purchase and sale form'''. Include any subject to clauses for conditions that are important to you, as discussed above.
{| class="wikitable"
|align="left"|'''Tip'''
If you are making an offer on a condominium (also known as '''strata housing'''), [[Buying a Condominium|see our information on buying a condominium]].
|}
===Step 3. Arrange for financing===
Perhaps you got pre-approval for a mortgage before making an offer to purchase. If not, as soon as you and the seller have signed a contract for purchase and sale, you should begin the process to get a mortgage, if you need one.
Shop around to get the best terms, and promptly give the mortgage company any documents and information it needs. Usually, a mortgage company will need an '''appraisal''' of the home before it promises to give you the mortgage. Often, this appraisal will be done at your own expense.
As well, the mortgage company may require certain documents prior to the '''completion date''' (the date the property transfers from the seller to you and you become the owner). For example, the mortgage company may require:
* '''Proof of insurance''', showing you’ve organized fire and liability insurance coverage for the home.
* '''A survey certificate''', showing the home is within the property boundaries.
* '''Title insurance''', which is an insurance policy that protects you and them from problems related to the property’s title, such as unpaid liens, an encroachment that isn’t discovered until later, or fraud.
{| class="wikitable"
|align="left"|'''Tip'''
Once you’ve arranged your financing, ask the mortgage company to give you a written commitment letter promising to give you the mortgage. You’ll need this letter to complete the sale.
|}
===Step 4. Remove any subject to clauses===
When you’re satisfied with the results of any subject to clauses or conditions (for example, the home inspection is fine), you should give written notice to the seller that you’re removing the conditions. Once you do this, the offer or counteroffer becomes a legally binding contract. There is no further cooling-off period to change your mind and cancel the contract.
If you can’t meet the conditions and don’t remove them, the contract ends and you don’t have to buy the home.
===Step 5. Prepare the transfer paperwork===
Most home buyers hire a '''lawyer''' or '''notary public''' to help with the paperwork to transfer legal ownership of the home in exchange for the purchase price of the home.
The lawyer or notary will do a '''title search''', which shows the registered owner of the home and any charges registered against the property, such as mortgages, liens, or easements. Any existing mortgages and liens will have to be discharged by the seller as part of the sale.
Before the completion date, your lawyer or notary will prepare a document called the '''statement of adjustments'''. This document shows all money coming in and going out. It covers things you and the seller share, such as the annual property tax bill (the seller is responsible for the portion of the bill until the sale completes, and you’re responsible for the portion for the rest of the year). The most important figure for you is the amount you need by the completion date. This is the money you must pay, in addition to your mortgage.
Your lawyer or notary also prepares the transfer documents and sends them to the seller’s lawyer or notary. The seller signs the documents and returns them. Then, when your lawyer or notary has your down payment money and the letter from your financial institution promising the mortgage amount, they register the transfer documents and the mortgage with the land title office.
===Step 6. Complete the sale===
When the land title office confirms the registration of the transfer documents (and your financing cheque has arrived), your lawyer or notary gives the purchase moneys to the seller.
The realtor is then instructed to give you the keys to the home. Enjoy!
==Who can help==
===With more information===
The '''Real Estate Council of BC''', the body that licenses real estate agents in the province, offers a guide on “Buying a Home in British Columbia.”
* [https://www.recbc.ca/buyinghome-2.html Visit website]
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Latest revision as of 04:08, 7 October 2020

This information applies to British Columbia, Canada. Last reviewed for legal accuracy by Nathan Ganapathi and Anna Kurt, Ganapathi Law Group in October 2017.

Buying a home is an exciting life event. Learn the key factors to consider before you make an offer, and the steps involved in buying a home in British Columbia.

What you should know

Using a real estate agent

You may decide to look for a home on your own or you may use a professional to help you. There are advantages to working with a real estate agent. Agents can help you clarify the type of home you need and can afford. They are connected to networks of potential sellers and can help arrange appointments to view available properties. And they can help you navigate a complex process by:

  • explaining the forms used and helping you make a written offer to purchase
  • presenting your written offer to the seller
  • explaining the steps to complete the purchase after the seller accepts your offer

As well, keep in mind the seller typically pays both realtors (the seller’s realtor and the buyer’s realtor) from the sale proceeds after selling their home.

The money you will need

Before you start looking for a new home, it’s important to consider how much you can afford to pay. This will allow you to spend your time looking at homes in your price range.

Almost everyone who buys a home borrows some of the money needed to pay for it. The cash you can apply towards buying a home is called the down payment.

Obtaining a loan to borrow the rest of the money typically involves signing a document called a mortgage. This document sets out the terms and conditions for the loan and its repayment. If you fail to meet your obligations under the mortgage, the lender may have the right to take your home to pay off what you still owe.

The easiest way to learn how much money you will be able to borrow as a mortgage loan is to meet with one or more financial institutions. These lenders will look at your family’s current income and debts and do a credit check to decide how much they will lend to you.

For more, see our information on mortgages and financing a home purchase.

The costs of buying a home (other than the purchase price)

A home is often the most expensive thing you’ll ever buy. Yet the purchase price is not the end of it. There are many extra costs when you buy a home, in legal fees and other transaction costs, and particularly in taxes.

Property transfer tax

When you purchase property in BC that is registered at the land title office, you're responsible for paying property transfer tax. You pay the tax based on the purchase price of the property. The tax rate is:

  • 1% on the first $200,000 of the price,
  • plus 2% on the rest of the price up to $2,000,000,
  • plus 3% on amounts over $2,000,000,
  • and, for a residential property, another 2% on amounts over $3,000,000

If you’re purchasing your first home, you may qualify to reduce or eliminate the amount of property transfer tax you pay. There are other exemptions as well. For details, see the BC government website.

Other taxes

Other taxes apply in certain circumstances.

If you are a foreign national, you must pay an additional property transfer tax of 20% if the property is within specified areas of BC. These include Metro Vancouver, Greater Victoria, Fraser Valley, Central Okanagan, and Nanaimo.

Goods and services tax (GST) of 5% applies to the purchase price of all newly-constructed or substantially renovated homes. GST also applies to most legal fees and other costs of buying a home.

Provincial sales tax (PST) of 7% applies to most legal fees and other costs of buying a home.

Making an offer to purchase

If you find a home you want to buy, you must make a written offer to buy it. Verbal offers and agreements for land may not be valid. A realtor can provide a form, usually from the local real estate board, called a contract of purchase and sale. Read it carefully, as this offer can lead to a legally binding contract. If there’s anything in it you don’t like or doesn’t apply, cross it out with a pen, then initial the change. Get the seller to initial any change as well.

What to include in the offer

Give the seller a time limit to accept your offer — normally a day or two. If the seller doesn’t accept it by then, your offer expires, allowing you to make an offer to someone else.

When someone sells a home, all the fixtures go along with it. Generally, a fixture is anything that’s attached to the home to the point where removing it would damage the home or require repair. The bathroom sink is an obvious example. The appliances — such as the washer, dryer, fridge and stove — are not fixtures. It’s best to specifically list in the offer anything that might be thought to be a fixture, that you want the seller to include in the sale — such as appliances, curtains, mirrors or chandeliers. Add a sentence that the purchase price includes these items and make sure each item is listed.

You might want to make your offer conditional on the home passing an inspection by a professional building inspector. To do this, you can use a subject to clause, which spells out a condition that must be met before a sale proceeds. While the seller usually gives you a disclosure statement listing any potential problems the seller knows about, you might still want your own inspector to look at the home.

You can also use a subject to clause if you must sell your own home before you can buy the new one. You can make your offer conditional on selling your current home by a date you set.

If you need a mortgage, you can make your offer subject to getting satisfactory financing. This is wise even if the bank has already pre-approved a mortgage amount, just in case.

You may consider a statement saying the offer is subject to your lawyer’s approval, so you can have a lawyer check the offer before it becomes a binding contract.

How much to pay as a deposit

When you make an offer, you’ll have to make a deposit, which you’ll want to keep as low as possible. The normal deposit is 5% to 10% of the purchase price. The deposit should be paid to the realtor in trust, not directly to the seller.

If the seller makes a counteroffer

The seller may accept your offer, or may cross out some of your terms and add new ones. If the seller changes your offer in any way, it becomes a new offer by the seller known as a counteroffer. The counteroffer cancels your original offer. You must then decide if you want to accept the counteroffer or make a counteroffer of your own to the buyer. You do not have to accept a counteroffer.

Hiring a lawyer

Buying a home is a major expense and a complicated process. As well, there are risks of very bad things happening when buying real estate, if you’re not experienced and watchful. For example, people can:

  • use a false identity to pretend they are the true owner of a property and sign documents fraudulently
  • sell the same property several times in back-to-back transactions to falsely inflate its asking price

These are two examples of real estate fraud. To protect yourself, you should consider using a lawyer to advise you through the process of buying a home.

The process to buy a home

Step 1. Decide if you are hiring a real estate agent

Decide if you are going to look for a home on your own or hire a real estate agent.

If you decide to use a realtor, pick someone you trust and are comfortable with.

If you decide to look for a home on your own, good places to start looking are local newspapers and the internet, where there are various listing websites.

Tip

Under the law in BC, real estate agents must be licensed. You can use the licensee search from the Real Estate Council of BC to see if an agent is currently licensed.

Step 2. Make an offer

When you find a home you want to buy, make an offer to purchase. A realtor can help you write up the offer on the local real estate board’s contract of purchase and sale form. Include any subject to clauses for conditions that are important to you, as discussed above.

Tip

If you are making an offer on a condominium (also known as strata housing), see our information on buying a condominium.

Step 3. Arrange for financing

Perhaps you got pre-approval for a mortgage before making an offer to purchase. If not, as soon as you and the seller have signed a contract for purchase and sale, you should begin the process to get a mortgage, if you need one.

Shop around to get the best terms, and promptly give the mortgage company any documents and information it needs. Usually, a mortgage company will need an appraisal of the home before it promises to give you the mortgage. Often, this appraisal will be done at your own expense.

As well, the mortgage company may require certain documents prior to the completion date (the date the property transfers from the seller to you and you become the owner). For example, the mortgage company may require:

  • Proof of insurance, showing you’ve organized fire and liability insurance coverage for the home.
  • A survey certificate, showing the home is within the property boundaries.
  • Title insurance, which is an insurance policy that protects you and them from problems related to the property’s title, such as unpaid liens, an encroachment that isn’t discovered until later, or fraud.
Tip

Once you’ve arranged your financing, ask the mortgage company to give you a written commitment letter promising to give you the mortgage. You’ll need this letter to complete the sale.

Step 4. Remove any subject to clauses

When you’re satisfied with the results of any subject to clauses or conditions (for example, the home inspection is fine), you should give written notice to the seller that you’re removing the conditions. Once you do this, the offer or counteroffer becomes a legally binding contract. There is no further cooling-off period to change your mind and cancel the contract.

If you can’t meet the conditions and don’t remove them, the contract ends and you don’t have to buy the home.

Step 5. Prepare the transfer paperwork

Most home buyers hire a lawyer or notary public to help with the paperwork to transfer legal ownership of the home in exchange for the purchase price of the home.

The lawyer or notary will do a title search, which shows the registered owner of the home and any charges registered against the property, such as mortgages, liens, or easements. Any existing mortgages and liens will have to be discharged by the seller as part of the sale.

Before the completion date, your lawyer or notary will prepare a document called the statement of adjustments. This document shows all money coming in and going out. It covers things you and the seller share, such as the annual property tax bill (the seller is responsible for the portion of the bill until the sale completes, and you’re responsible for the portion for the rest of the year). The most important figure for you is the amount you need by the completion date. This is the money you must pay, in addition to your mortgage.

Your lawyer or notary also prepares the transfer documents and sends them to the seller’s lawyer or notary. The seller signs the documents and returns them. Then, when your lawyer or notary has your down payment money and the letter from your financial institution promising the mortgage amount, they register the transfer documents and the mortgage with the land title office.

Step 6. Complete the sale

When the land title office confirms the registration of the transfer documents (and your financing cheque has arrived), your lawyer or notary gives the purchase moneys to the seller.

The realtor is then instructed to give you the keys to the home. Enjoy!

Who can help

With more information

The Real Estate Council of BC, the body that licenses real estate agents in the province, offers a guide on “Buying a Home in British Columbia.”

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