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41 Cards in this Set
- Front
- Back
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Seller's lawyer Step 1
When _____, that lawyer will open a file. _____ will be placed in that file folder, usually on a brad. The file will be _____. Each firm has its own system of assigning numbers to files, usually something like the New Case Report (see Appendix 9.1). |
the Sellers' lawyer obtains instructions to act,
All documentation, copies of searches, and correspondence
assigned a file number
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All expenses that the firm has incurred, which will be collected back from the client (disbursements), will be charged to that file. As well, any time that the lawyer or legal assistant may post, and any trust funds received and disbursed on behalf of the client, will be recorded to the file number in the firm’s accounting computer system. At the end of the transaction, the legal assistant can obtain _____for the firm’s accounting purposes and for the report to the client. |
a printout of all of the transactions in relation to that file number
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Normally, the lawyer does not receive instructions to act for the Sellers until ______,” which means that ______. The lawyer usually receives the Real Estate Purchase Contract from the realtor and will
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the Real Estate Purchase Contract is “firm
all conditions have been satisfied and waived and both parties have agreed that the agreement is binding
review all of the essential terms of the Contract, including the parties, purchase price, how the Buyers will be paying the purchase price, the closing date, representations, and warranties.
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Step 4 contact client It is wise at this stage for the Sellers' lawyer to contact the Sellers to _________. The Sellers’ lawyer should also obtain a ______ (if not already given to the Buyers), and find out if there is _______. |
confirm instructions to act, the amount of the real estate commission, and the Canadian residency of the Buyers
Real Property Report
anything unusual in relation to the transaction
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Contact buyer's lawyer
The Sellers' lawyer will likely contact the Buyers' lawyer to confirm that ______, and to inquire as to _______. An example of a letter sent by the Sellers' lawyer to the Buyers' lawyer is included as Appendix 9.3. |
the Buyers' lawyer has instructions to act
how the Buyers wish to be described on title |
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It will be the responsibility of the ______to discharge _____that are not _______. |
Sellers' lawyer
any financial encumbrances registered against title
being assumed by the Buyers |
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Normally, the Buyers will be ______, and the Sellers' lawyer _______. The lawyer will obtain a ______ and write to the mortgage company asking for a _______, which is a document produced by the _______, with a _______. |
placing their own mortgage on the property will be discharging the Sellers' mortgage copy of the Mortgage Payout Statement or Discharge Statement mortgage company advising the amount owing on the mortgage as at closing date per diem rate thereafter
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When the Sellers' lawyer receives all of the funds from the Buyers' lawyer, the Sellers' lawyer will _________on the condition that _________. |
forward to the Mortgagee (mortgage company) sufficient funds to pay the total amount owing on the mortgage
Mortgagee provide to that lawyer in due course a registerable Discharge of Mortgage |
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Note that the Mortgage Payout Statement will provide a ________. This is because, from time to time, a transaction may ______, and the Sellers’ lawyer will want to know ____if the transaction closes on July 4th rather than the closing date of July 1st. |
statement of the balance owing as at closing date with a per diem rate thereafter. close a day or two late exactly how much is required to payout the mortgage
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Where the Buyers are assuming the mortgage, the Sellers’ lawyer will request a ______. An Assumption Statement (Appendix 9.7) is similar to a Payout Statement in that it ______. That amount is the debt that _______, and it is the amount that the Sellers’ lawyer will _______ (Module 8). |
Mortgage Statement for Assumption Purposes discloses the amount owing on a mortgage as at closing date
the Buyers will be taking over include in the Statement of Adjustments
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A Payout Statement from a Mortgagee may differ from an ______ from a Mortgagee, even though ______. This is because often a Mortgage will provide that, if _________. |
Assumption Statement it is for the same mortgage and for the same date the mortgage is paid out before maturity, there is a penalty ______.
________when the mortgage is being assumed, and so the amount required to payout a mortgage on a certain date is often _____
That penalty is not applied
greater than the amount owing on the mortgage on that same date if the mortgage is being assumed payable by the Sellers for that early payout. |
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In the event of a Vendor Take-Back Mortgage (VTB Mortgage), normally the Sellers' lawyer prepares _______and sends the VTB Mortgage to _____. The cost of the VTB Mortgage is generally paid by _____. |
the Mortgage on the terms agreed to between the Sellers and Buyers
the Buyers' lawyer to be executed by the Buyers
the Buyers |
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Because the Sellers are normally obligated to provide a ________ , it is critical that the _____ be ordered very early in the proceedings. The lawyer will check with the Sellers and the realtor to determine if ______, and whether _____. |
Real Property Report and Compliance Certificate 7 days before the closing of the transaction there is a Real Property Report in existence it is sufficiently up-to-date
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If a Real Property Report is required, the realtor, the Seller, or the lawyer will order it through a _____. Some firms acting for Buyers refuse to ______ until ______. If the Real Property Report discloses a problem with ______, this could seriously ______. |
survey company submit transfer documentation to the Land Titles Office
they have had the opportunity to review the Real Property Report.
the location of the buildings delay the release of funds
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From time to time, a revenue property will be sold with the existing tenancies. The Buyers buy the property with the tenants in place and will assume the _______. ______ will need to be made for _____. |
obligations of the tenancy as landlords
Adjustments
any rental paid for the month of possession, for any prepaid rent, or for a security deposit paid by the tenant. |
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It is usually the obligation of the ______, in the sale of condominium, to provide _____with an _____. This is a document prepared by the ______ by which the condominium manager certifies that: |
Sellers the Buyers Estoppel Certificate condominium management company That document, being a “certificate,” can be relied upon by the Buyers.
There are no legal actions against the Condominium Corporation; and
All condominium fees levied against the particular unit have been paid.
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The Sellers' lawyer will forward _______ to the Buyers' lawyer, along with a _____r. All of these documents are sent about ______to give the Buyers' lawyer enough time to register the transfer and any new mortgage. |
the Transfer of Land, Statement of Adjustments, and any other documentation trust letter 2 weeks before the closing date
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Where funds or documents are sent to a lawyer under trust conditions, _____ |
that lawyer can only use those funds or documents if he or she abides strictly and completely by those trust conditions. |
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The Buyers' lawyer will have to be sure that all trust conditions _____. If the Buyers’ lawyer is unsure of being able to satisfy any of the trust conditions, ______. |
can be satisfied
the lawyer cannot use the documents
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If the Buyers' lawyer feels that the trust conditions may be unfair or unreasonable, he or she must _______. If satisfactory amendment cannot be agreed to by both parties, the Buyers' lawyer must _______r. If the Buyers' lawyer uses the documents, he or she is _____. |
request and receive written amendments to those trust conditions from the Sellers' lawyer return the documents to the Sellers' lawyer
deemed to have accepted all of the trust conditions |
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the Sellers' lawyer gives an undertaking. In this case, the undertaking is that, ______. An undertaking has exactly the same effect as a _______. |
once the Sellers' lawyer receives all the funds, the Sellers' lawyer will use those funds to discharge the Sellers' mortgage
trust condition |
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The purpose of trust conditions in the situation where the Buyers are getting a new mortgage is to protect the ______, who are ______.
The Undertakings protect the _____, who want to be sure that ________. |
Sellers giving up their title and possibly possession of the property without being paid
Buyers any financial encumbrances not being assumed are discharged and that they have title to and possession of the property before the purchase monies are released to the Sellers.
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Typically these trust conditions require the following: |
-fire insurance -cash difference -transfer back _tenancy at Will -irrevocable assignment of mortgage proceeds and direction |
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Fire Insurance: It is critical that the property is insured in case _______. The Seller should be told to _______. |
it is damaged before the Seller gets the balance of his or her money.
keep his or her insurance on the property as well until all monies have been paid |
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Cash Difference: The cash to close found in the Statement of Adjustments is ______. Typically, most of this amount comes from _______, with _______. The Sellers want to make sure they receive that part of the cash to close that comes from the Buyers' pocket—the cash difference—before the Transfer is used. |
the total amount of money that must be paid to the Sellers to complete the transaction
the mortgage company
balance coming from the Buyers' pocket
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Transfer back Purpose |
This is a Transfer of Land from the Buyers to the Sellers for $1.00 and is to be used to get title back into the Sellers' name if the balance of the purchase price is not paid within a reasonable time after the closing date. |
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Tenancy at Will |
4. Tenancy at Will: The Buyers sign this document agreeing that, notwithstanding their names appear as the registered owners of the property, they are only tenants on the property until the balance of the purchase price is paid and that they will vacate the property on 48 hours’ notice if required. |
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Tenancy at Will |
5. Irrevocable Assignment (Irrevocable Assignment of Mortgage Proceeds and Direction to Pay): This document directs the mortgage company to send the mortgage proceeds to the Buyers' lawyer and directs the Buyers' lawyer to send it to the Sellers' lawyer. Its purpose is to keep the mortgage money from falling directly into the Buyers' hands. |
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The Sellers' lawyer now has all the money due to the Sellers. The Sellers' lawyer uses those funds to payout any obligations that the Sellers have to close the deal, most commonly:
Then The Sellers' lawyer then ______ to the Sellers and prepares to the Sellers a final _______ which indicates the ______. The Sellers' lawyer then either forwards to the Sellers ______. |
the balance of any real estate commission, the Sellers' mortgage, and any condominium arrears or tax arrears.
renders his or her account Statement of Sale monies received on behalf of the Sellers, the monies paid out on behalf of the Sellers, and the balance left to the Sellers' credit.
a cheque or deposits the proceeds into the Sellers' bank account, as that lawyer has been instructed.
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The Sellers' lawyer sometimes prepares a ______, which is an accounting of ________. This is a useful way to ______, and is sometimes included in the ______. |
trust account reconciliation all the monies received and disbursed from the law firm’s trust account double-check the accuracy of the Sellers' Statement of Sale
final reporting letter to the client
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The Sellers' final Statement of Sale is very similar to the Statement of Adjustments, except that it _____. The Statement of Adjustments gave the Buyers credit for the deposit paid by the Buyers. The Sellers' Statement of Sale does not include that amount since the Sellers are not particularly concerned with how the Buyers pay for the property, but just that the total amount of money has in fact been paid. It is the Sellers' responsibility to pay the real estate commission so _______, will be included on the Sellers' Statement of Sale. |
refers only to matters of concern to the Sellers
that item, plus GST on the commission and legal fees |
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The critical difference between acting for the Vendors and acting for the Buyers is what the client wants at the end of the transaction: |
The Vendors want to get their money from the transaction. The Buyers are interested in possession of the property itself and will need to be aware of any encumbrances that may be registered against that property that might affect their right of ownership. |
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Normally, the Vendors' lawyer will require three documents as security for the Vendors when the Buyers are placing a new mortgage on the property. Those documents are the: |
Transfer back Tenancy at Will agreement -Irrevocable Assignment of Mortgage Proceeds, also known as a Direction to Pay or an Irrevocable Order for Payment. |
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The Sellers' lawyer sometimes prepares a ______, which is an accounting of ________. This is a useful way to ______, and is sometimes included in the ______. |
trust account reconciliation all the monies received and disbursed from the law firm’s trust account double-check the accuracy of the Sellers' Statement of Sale
final reporting letter to the client
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The Sellers' final Statement of Sale is very similar to the Statement of Adjustments, except that it _____. The Statement of Adjustments gave the Buyers credit for the deposit paid by the Buyers. The Sellers' Statement of Sale does not include that amount since the Sellers are not particularly concerned with how the Buyers pay for the property, but just that the total amount of money has in fact been paid. It is the Sellers' responsibility to pay the real estate commission so _______, will be included on the Sellers' Statement of Sale. |
refers only to matters of concern to the Sellers
that item, plus GST on the commission and legal fees |
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The critical difference between acting for the Vendors and acting for the Buyers is what the client wants at the end of the transaction: |
The Vendors want to get their money from the transaction. The Buyers are interested in possession of the property itself and will need to be aware of any encumbrances that may be registered against that property that might affect their right of ownership. |
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Normally, the Vendors' lawyer will require three documents as security for the Vendors when the Buyers are placing a new mortgage on the property. Those documents are the: |
Transfer back Tenancy at Will agreement -Irrevocable Assignment of Mortgage Proceeds, also known as a Direction to Pay or an Irrevocable Order for Payment. |
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The Buyers should be in a position to attend at the lawyer’s office about _______before the closing date so that the transaction can close on time. The Buyers will sign all mortgage documentation and place the cash shortfall in the lawyer’s trust account. The cash shortfall is _______. |
1 week the amount of money the Buyer has to bring in over and above the mortgage to pay everything: the balance of the cash to close, legal fees, and
possible late interest |
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The Buyers will also be required by the Law Society to sign a Conflict of Interest letter. If the law firm is acting for the mortgage company as well as the Buyers, _______ is required. |
the Buyers’ written consent |
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Once the Buyers' lawyer has received _______, and not before that, the Buyers' lawyer will forward ______ and then can ______. Note that not all the money the Buyers brought in will be sent to the Vendors' lawyer. If it is, then the Buyers’ lawyer’s legal fees will have been sent to the Vendors' lawyer. |
the cash shortfall from the Buyers
the cash difference to the Vendor's lawyer
submit the documents to Land Titles Office
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