Two-Step Process in Real Estate Transactions
Generally speaking, purchase and sale of real estate is a two-step process:
- Entering into an Agreement of Purchase and Sale
- Closing the transaction
Agreement of Purchase and Sale
In Ontario, the Agreement of Purchase and Sale is typically entered into on the OREA Form. It sets out important points of the transaction including:
- Purchase Price
- Deposit Amount
- Title Search Date
- Closing Date
- Conditions to Closing
- Warranties
Closing
Once the agreement of purchase and sale is signed by all parties, the lawyers for the buyer and the seller begin working on closing the transaction. Closing refers to fulfilling and completing the terms in the agreement of purchase and sale including the utlimate transfer of purchase funds and title.
Closing is considered complete the moment the lawyer for the buyer and the seller register a transfer on title to change the ownership from the seller to the buyer.
