The legal process after buying or selling a home can be unfamiliar and seem complicated. This short summery of the normal process of buying a home – every situation and transaction is unique is and seeking independent legal advise is always recommended.
- Removal of subjects
When offering on a property, it must be in writing in a standard form called the “Contract of Purchase and Sale”, generally written by the Buyer’s Realtor. This Contract of Purchase and sale (offer) contains all the standard terms and conditions, dates for completion and possession and specific items included in the sale.
The offer will have an expiration time and date, generally one to three days after the presentation of the offer (unless there are additional parties offering on the same properties, this time expiration time could be the end of the same day as the presentation of the offer).
The contract must be signed by the Buyer and any changes or edits to the contract must be initialed. The contract includes the price, deposit, list of subject conditions (ex. Financing, home inspection etc.) the completion date and possession date.
The Seller can choose to accept, counter the offer or reject the offer. When the offer is countered (using the same contract), any changes are written on the offer and then initialed. The Seller also signs the contract. When an offer is countered by either party (the Buyer or Seller), it forms a commitment with signing party; when both parties indicate an acceptance of all the terms at the last change.This is called “Acceptance”
Following the acceptance of the offer, the Buyer normally has a few days to fulfill or remove their subject conditions. The Seller may need to cooperate by providing access to the property for an inspector, appraiser or surveyor. When the Buyer is satisfied and has removed their subject conditions, which is in writing, the offer is considered a firm and binding contract.
The next step is the Conveyancing process of transferring the title of the property from the Seller to the Buyer. In BC, title is registered and fully documented at the BC Land Titles Registry. The Buyer and the Seller generally uses the services of a lawyer for the Conveyancing. A few days prior to the Completion date the Buyer transfers the balance of the money for the purchase to their lawyer, in trust. The lawyer holds the money and does a final confirmation with the Land Titles Registry that the Seller is in fact the current owner, then calculates the exact amount of the money to transfer for the sale, including the deposits and adjustments and files the paperwork with the Registry. Once this has all been completed and Title has been registered to the Buyer’s name then the funds are released to the Seller.