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Making the offer

The Offer to Purchase is prepared by the real estate agent based on the price, closing date, and any special conditions (such as financing) the potential buyer wants included There may be conditions or clauses that should be included in the Offer that are specific to the property type. Once you have signed the Offer and it is accepted, it cannot be changed or easily cancelled unless the other party agrees .

The Buyer makes an ‘Offer’ to purchase the property which will be presented to the Seller. If the Seller agrees to those terms, he/she may accept the Offer without making any changes. If the Sellers are not in agreement with the terms of the offer, and they make changes, they are really saying “I don’t accept the terms of your offer, will you accept these terms?” The document does not become an Agreement of Purchase and Sale until all of the parties to the document have agreed to all of the terms contained in it. The agreement becomes ‘firm’, once all of the conditions contained in the Agreement have been satisfied or waived. Once an agreement becomes firm, you cannot easily terminate it, unless the other parties agree to release you from the agreement.

If there is no real estate agent involved in the transaction, the lawyer representing the person wishing to buy the property will usually prepare the Offer for the Buyer, and deliver it to the Seller’s lawyer.

Choosing the Title search date

The Buyers’ lawyer must complete a full search of the title to the property by this date. They also must send notice to the Sellers’ lawyer by this date of any defects of title or liens against title, which must be corrected or removed before closing. This is also called the Requisition or Title Search Date. The length of time between the date that all conditions of the Agreement will be satisfied, and the Title Search Date must be sufficient to allow the Buyers’ lawyer to complete this work. One to two weeks is recommended.

Choosing the Completion/Closing date

This is the date on which you want to become the legal owner of the property, or in other words, the date the transaction is to be completed. The length of time between the title search date and the completion date should be long enough for the Seller’s lawyer to deal with any issues discovered in the title search. Two weeks is most helpful for the Seller’s lawyer.

Home inspections

It is usually advisable for Buyers to have a qualified home inspector inspect the property and point out any areas that are of concern. A clause should be inserted into the Offer giving the Buyer a specific length of time to obtain a satisfactory home inspection. Home inspectors do not guarantee that there will not be any problems found after you purchase the home, but their assistance reduces the likelihood of finding problems after closing. The basic motto continues to be “buyer beware”.

Home Insurance

If you are purchasing a property, you should speak to your insurance agent about providing adequate coverage for the property. If there will be a mortgage or line of credit registered to complete the purchase of the property, it must be for a minimum of the amount of the mortgage, or guaranteed replacement value. The interest of the financial institution must be noted on the policy. The insurance agent will need to fax a copy of the insurance binder to the lawyer’s office prior to closing.

Title Insurance

Title Insurance is not intended to replace the lawyer’s search of title, and a full title search will always be performed where we are acting for the Purchaser in a transaction. It is our firm’s policy to order title Insurance on every purchase transaction, unless we are instructed by our client not to. Our decision to arrange title insurance in purchase transactions, is based on protecting our clients from mortgage fraud and identity theft related to the property, as well as its other benefits. Title insurance also provides protection where, after you purchase your property: it is discovered that someone else owns an interest in your title; there are violations of municipal zoning by-laws; there are encroachments that must be dealt with; or an issue is discovered when a new survey of the property is prepared. Banks often require title insurance or accept it in lieu of a building location survey. To obtain more information about title insurance visit

Land Transfer Tax

There is no Land Transfer Tax payable by the Seller of the property. With a few exceptions, all purchases of real property are subject to Land Transfer Tax. First Time Home Buyers are usually eligible for a full or partial exemption from Land Transfer Tax.  The tax is calculated on the purchase price at the rate of ½% on the first $55,000.00; & then 1% on the amount above that up to & including $250,000.00; 1 ½% on the portion above $250,00.00 up to & including $400,00.00 and 2% for amounts exceeding $400,00.00 where the property contains 1 or 2 single family residences.The lawyers will be required to submit this tax to the Minister of Finance on the day of closing, before they can register your Deed/Transfer of Land giving you title or ownership.

TARION Warranties

TARION was formerly known as the Ontario New Home Warranty Plan. If you are purchasing a newly constructed home, there is Statutory Warranty Coverage through TARION with respect to defects in work and materials, and major structural defects. It also provides deposit protection as well as protection against delayed closings or occupancies, where proper written notice has not been provided by the builder. To learn more, go to


The sale of a used residential property is not subject to HST, as long as it has not been substantially renovated. Most Offers for a used residential property can therefore safely state that ‘HST, if applicable, is included in the purchase price’. When purchasing a newly constructed home, the Purchase Price generally includes HST, and is based on the assumption that you will be eligible for the HST Rebate (usually meaning that the home will be your primary residence). If this assumption is correct, you will end up paying the purchase price stated in your Agreement of Purchase and Sale. If you are purchasing the property as an investment property and renting it out to someone else, you will likely be charged an amount equal to the HST Rebate, in addition to the purchase price stated in the Agreement. You should always consult your lawyer or an accountant before signing an Agreement for a vacant parcel of land or a property used for commercial purposes, as there will be issues with respect to HST to be discussed.