Residential & Commercial Real Estate

Residential & Commercial Real Estate

MHR Law’s Real Estate Group handles a wide variety of residential, commercial, and agricultural Real Estate transactions in an efficient professional manner. We provide services in all areas of real estate.

Residential

Residential Real Estate includes the refinancing or buying and selling of Houses, Duplexes, Town Houses, Condos, and Small Acreages.

 

Buying & Selling

The OFFER: Residential Real Estate begins with the signing of a Real Estate Purchase Contract often referred to as the “Offer”. Usually the Offer is prepared and negotiated through the Realtors and then delivered to us as Lawyers to complete the transaction on the terms of the Offer.

We can:

  • Review the Offer prior to signing to advise you of the legal obligations you are undertaking if you sign;
  • If the Offer is signed but one of the conditions is a lawyer’s approval, we can review the Offer and advise you of the legal obligations you are agreeing to before the Offer becomes binding;
  • If there are no Realtors and it is a private sale, we can work with you to prepare the Offer.

The CLOSING: Once any conditions of the Offer are waived, the next step is to close or complete the deal.

We can:

  • If you are the Seller, we prepare all of the documents needed from the Seller to allow the property to be transferred at Land Titles to the Buyer and to make sure you receive the amount of sale proceeds you have contracted to get. We pay out any mortgages or other such encumbrances on the title. If required, we assist with any matters arising from the property not complying with Municipal rules, by-laws and regulations;
  • If you are a Buyer, we prepare any forms needed for the Buyer such as Mortgage documents and ensure that you are receiving clear title, a compliant property, vacant possession and only paying the amount of the agreed purchase price.

Conditions

Conditions are items placed in a real estate contract to ensure all parties to the contract are able to proceed with the contract. Common conditions include:

  • Financing Condition: this condition allows the buyer to ensure they are approved by their lender for financing before being committed to purchasing the property
  • Property Inspection: this condition allows the buyer to inspect the property to ensure there are no defects with the property prior to being committed to purchasing the property
  • Sale of Buyer’s Home Condition: this condition allows the buyer time to find a buyer for their existing home before they are required to purchase the seller’s property.

Refinancing

The refinancing of a residential property occurs when you desire to increase the amount of your mortgage or you decided to switch lenders. MHR Law’s role in a refinance is to work with you and lender to ensure the mortgage documents are properly prepared and registered at Land Titles to ensure you receive you mortgage funds in a timely fashion.

Title Insurance

MHR Law partners with Chicago Title Insurance. Please refer to Chicago Title and this video for more information.

Commercial

MHR Law provides exceptional services in dealing with the sale of Farms and large Acreages, Office Buildings, Retail properties, and Warehouses. Many of our lawyers have farming or business backgrounds which enable us to understand and resolve the intricate difference in commercial and agricultural transactions.

The steps in the purchase or sale of commercial properties are very similar to those for residential properties and we can provide a wide range of services for these transactions.

Agriculture

MHR Law provides exceptional services in dealing with the sale of Farms and large Acreages, Office Buildings, Retail properties, and Warehouses. Many of our lawyers have farming or business backgrounds which enable us to understand and resolve the intricate difference in commercial and agricultural transactions.The steps in the purchase or sale of commercial properties are very similar to those for residential properties and we can provide a wide range of services for these transactions.

Lawyer's Role

Why do I need a lawyer for a real estate transaction?

Lawyers add value to real estate transactions by helping you understand your rights and obligations, preparing your closing documents (and in some cases your purchase contacts), and by ensuring that sellers receive the purchase money and that buyers receive a title free from financial encumbrances (e.g., mortgages, builders’ liens, etc.). Please contact our office if you have specific questions about your lawyer’s role in the real estate process.

Can a buyer and seller use the same lawyer for a real estate transaction?

Yes, a buyer and seller can use the same lawyer in a real estate transaction provided that both parties consent to that arrangement after being informed of the associated limitations. For example, parties should be informed about limits to confidentiality and that they will be required to seek independent counsel should a dispute arise between them. However, despite the limitations, most real estate files proceed without conflict and parties frequently save money by removing the costs associated with employing separate law firms.

Who can assist me with drafting my purchase contract?

If you are working with a realtor, they will assist you with completing their standard form contract. However, it is often helpful to have a lawyer review and explain your contractual obligations before you sign. Alternatively, you can seek our assistance with drafting a contract specifically tailored to your needs.

What documents will I review and sign with a lawyer?

Assuming that your real estate agent drafted your purchase contract (i.e., your “offer to purchase”), your lawyer’s job is to prepare various closing documents and then meet with you to review and sign them. The exact documents will vary depending upon your unique circumstances, such as whether you are the buyer or the seller, but will often include:

  • the property’s certificate of title and the encumbrances thereon;
  • mortgage paperwork;
  • transfer documents;
  • the statement of adjustments, which allocates fees between the buyer and seller that are paid in advance or at the end of a certain period of time (e.g., taxes)
  • realtor fees;
  • your lawyer’s account;
  • a breakdown of how various fees will be paid.

Rest assured, our firm is happy to review and explain all documents applicable to your real estate transaction.

Purchase Contracts

What type of information should be included in a purchase contract?

A purchase contract, or an “offer to purchase” should always be in writing and should include at least the following information:

  • Basic information about the property (e.g. address and legal description);
  • The purchase price;
  • The deposit made on the purchase price;
  • Various terms, such as which pieces of personal property (e.g. hot tubs, light fixtures, etc.) are included;
  • The encumbrances that will remain on title, if any;
  • The seller’s representations and warranties, including representations about dower rights;
  • Closing and possession dates;
  • Liability for insurance coverage;
  • Remedies for breach of contract; and
  • The parties’ signatures.
What steps should a buyer take before making an offer to purchase?

Prior to making an offer to purchase, a buyer should always review the certificate of title of the property he or she is interested in purchasing. Our firm can conduct searches for a nominal fee. Reviewing the certificate of title can alert buyers to financial encumbrances, easements, restrictive covenants, party wall agreements and other encumbrances registered against title that may make the buyer reconsider his or her offer.

Additionally, reviewing the certificate of title can alert buyers to the fact that a property is a bare land condo (see question below for more details). Further, buyers should carefully consider which conditions, if any, they wish to place on the sale. For instance, if the buyer is purchasing a condo, they should request a copy of the condo documents and make sure that any offer to purchase is contingent upon a satisfactory review thereof. Finally, buyers should consider getting pre-approved for a mortgage to expedite the purchase process.

What are some common conditions buyers have? Why are they important?

Many buyers include some or all of the following conditions:

  • Securing satisfactory financing;
  • Selling one’s own home;
  • Receiving a satisfactory property inspection report; and
  • Having a satisfactory review of condo documents.

Conditions are important as they give the party that placed them the opportunity to rescind (i.e., the ability to exit a contract without penalty as if the contract never existed) if the conditions are not met. If you are only willing to purchase a property on certain conditions, those conditions must appear in your written contract. If a condition was only stated orally, you would still likely be contractually obligated to proceed with the purchase whether or not your spoken condition was met.

What steps should a seller take before accepting an offer to purchase?

Before accepting an offer to purchase, the seller should take several steps to ensure the process proceeds smoothly. One of the first steps a seller should take is to ensure that the seller has the right to sell the property. As noted below, if you are married, the property you are selling may be subject to dower rights. If so, your spouse’s consent is required as he or she would be able to prevent the sale.

Additionally, problems can arise if the seller has a tenant who refuses to leave, especially if the tenant is legally entitled to stay pursuant to the Residential Tenancies Act. If you have a tenant, we recommend you review your situation with a lawyer so that we can help you better understand your rights and obligations.

The seller should examine his or her certificate of title as any financial encumbrances (e.g. builder’s liens) will need to be addressed prior to transfer. We can obtain a copy of your certificate of title for a nominal fee. Further, as noted below, most real estate contracts require the seller to provide warranties to the buyer regarding municipal compliance. Consequently, obtaining real property reports (RPRs) with municipal compliance in advance helps avoid unpleasant surprises and expedite closing.

Additionally, the seller should carefully consider the wording of any conditions stipulated by the buyer. If the buyer’s conditions are unlikely to be complied with, significant time can be wasted. Finally, it is important to consider any offer to purchase in light of the realtor fees and financial encumbrances that will have to be paid out to complete the deal.

What are dower rights?

Upon getting married, the Dower Act grants spouses certain rights to the “homestead” and personal property of their spouses. These rights are important as they offer protection to spouses who are not registered owners of their residence. The term “homestead” refers to a parcel of land where the parties’ dwelling house is located, which is the property used as the owner’s residence.

The specific parameters for homesteads and dower rights are outlined in the Dower Act. For real estate purposes, one of the most important dower rights is a spouse’s right to prevent the sale of the parties’ homestead. To proceed with the sale, the non-registered spouse must waive his or her rights to the homestead or the registered spouse must obtain a court order dispensing with the need to obtain the spouse’s consent. If you have further questions about dower rights, please make a consultation appointment with one of our lawyers.

What is a real property report and why is it important?

Real property reports (RPRs) are survey reports that provide an aerial view of the property being sold. They establish the boundaries of the property and all improvements thereto and indicate whether the improvements have received a stamp of municipal compliance.

As a buyer, it important to receive a current RPR (i.e. an RPR that accurately depicts all improvements that have been made to the property) with municipal compliance to avoid subsequent problems with compliance issues (e.g., correcting an improvement that encroaches on a neighbouring property). Additionally, failure to obtain a current RPR may lead to unexpected registration issues and can negatively affect one’s ability to obtain mortgage funding.

As a seller, many contracts will require you to provide certain warranties to the seller about municipal compliance. Providing a current RPR ensures that your warranties are accurate.

What is title insurance?

When a real property report cannot be produced by the seller, the buyer may elect to purchase, or require the seller to purchase, title insurance for the buyer’s protection. However, it is important to note that this does not relieve a seller of his or her obligation to provide a current RPR with municipal compliance (assuming that the contract requires the seller to do so). Title insurance protects buyers from problems such as fraud and forgery and municipal compliance issues.

For example, if the seller built a fence that does not meet municipal compliance because it encroaches on a neighbouring property, title insurance may cover the costs associated with making the fence compliant. However, determining the extent of your coverage requires a careful review of the insurance policy, which we would be able to assist with. Should you have any specific questions about title insurance, please contact our office.

Purchasing Condos

What is a bare land condo?

Conventional condos only give individuals an interest in the space occupied by their units and in the common property but no interest in land. In contrast, although a bare land condo gives an individual an interest in land, the owner’s use of the land is still governed by a condo board and remains subject to condo fees.

A buyer should always review a property’s certificate of title prior to making an offer to purchase because it is impossible to know whether a property is a bare land condo without doing so. Additionally, because a bare land condo includes an interest in land, it is important to obtain a current real property report with municipal compliance prior to making an offer to purchase.

How is purchasing a condo different other forms of real estate?

There are considerable differences between purchasing a condo and purchasing other kinds of property. From a legal standpoint, one of the most significant differences is that purchasing a condo provides buyers with an interest in “common property”, which refers to the parts of the condo building that are used by all residents (e.g., hallways, elevators, etc.). While your interest in the common property permits you to access it, your interest also obligates you to contribute to the common property’s maintenance.

Which brings us to a second difference. When purchasing a condo, you will be required to pay condo fees to a board of elected representatives (i.e. the condo board). The board allocates your condo fees to various needs (e.g., heating, maintenance, etc.) or saves them in a “reserve fund” for future expenses. Unfortunately, if maintenance costs exceed the amount available in the reserve fund, condo owners can be given a “special assessment” that allocates the surplus cost amongst all condo owners.

Additionally, condos tend to place more restrictions on how condo owners use their property as the board will establish and enforce various bylaws. While some community associations place restrictions on other forms of real estate, condo restrictions tend to be more prohibitive. By reviewing condo documents prior to making an offer to purchase, the buyer can become aware of restrictions on their use of the property and various other important considerations about the condo. We offer condo document review at our firm.