Top Ten Questions & Concerns When Purchasing a Home

1. What is land transfer tax?
Land Transfer Tax is a provincial tax applied to the purchase of any home in Ontario. For example if the purchase price was $120,000, the land transfer tax payable would be $925. Call your lawyer to obtain an accurate figure for your land transfer tax.
2. How are the city taxes adjusted on the closing date?
Taxes for the year in which you purhcase are divided by 365 days in order to determine what the taxes are per day. The daily figure is multiplied by the number of days the vendor has had possession during that year. This figure is subtracted from what the vendor has paid, thus indicating what your taxes will be for the year in which you purchase.
3. Do I need a survey or title insurance?
Most lending institutions will require a survey or title insurance. A survey is a drawing, prepared by a surveyor, which will accurately locate the buildings on your lot. Title insurance is not a drawing but a policy that protects you and your mortgage company from some types of claims, and should be discussed in detail with your lawyer.
4. What is a tax account?
If your wish is that your bank/trust company pay your taxes you should be aware that the bank/trust company may require a tax account. A tax account usually means six months approximately prepaid taxes and should be discuessed in detail with your lender.
5. Why is my mortgage advance lower than my registered mortgage?
If you have chosen a Canada Mortgage & Housing Corporation (CMHC) insured mortgage, the CMHC fee and Provincial Sales Tax (PST) will be added to your registered mortgage; however, when your bank/trust company advances funds on closing, CMHC & PST will be deducted.
6. WHat should I do about utilities & fire insurance?
It is your obligation to contact Enwin Utilities Commission and Union Gas Limited to set up a new account. These institutions may be contacted any time after conditions have been removed. Enwin Utilities - 519-255-2727, Union Gas Limited - 888-774-3111. It will be required by your mortgage company that you place fire insurance on your home. Your agent may be contacted any time after conditions have been removed. It is advisable that you do not delay in contacting your agent as an inspection of your new home will be required.
7. Should I complete a final inspection?
A final inspection should be done before advising your lawyer to complete your purchase. It is advisable that you execute a thorough inspection if you are purchasing used housing & report any abnormalities to your lawyer immediately.
8. What is a chattel/fixture?
A chattel is a used item which stays with your home and is included in the purchase price. For example, a used stove or washer is considered to be a chattel, whereas a door is considered to be a fixture.
9. What can I do about a chattel that doesn't work or is broken after closing?
All chattels should be examined thoroughly on your final inspection and any deficiencies should be reported to your lawyer immediately. After your purchase has closed no warranty exists on used equipment, unless specifically noted.
10. How often should I call my lawyer?
Whenever you have a question or concern.