Sellers and buyers: what are the costs to pay at the notary and the mandatory documents to provide? - Key information
In a real estate transaction, going to the notary is the last step in formalizing the sale of a property. Signing the act of sale can cause some anxiety, excitement and many questions.
Since our real estate brokers accompany many clients in this last important step, whether for the sale or purchase of their property, our members want to help you better distinguish all the subtleties of the transition to the notary. Documents required at the various costs involved: this major step will no longer have any secrets for you!
The role of the notary
In a real estate transaction, the notary holds a neutral and central role. He/she must respect the rights of both the seller and the buyer. His/her tasks are many:
• The notary will receive the promise to purchase, examine the title deeds, the seller’s certificate of location, if applicable, the marriage certificate or the divorce certificate.
• The notary will write the deed of sale of the property, making sure that the facts are true in the promise to purchase. It is the signing of the bill of sale that formalizes the sale.
• The notary will write the mortgage deed. This is a document detailing all the components of the buyer’s loan (loan principal, interest rate, amortization period, etc.) related to the financing of the property. The notary verifies that the provincial and municipal taxes have been paid and that the mortgage balance has been paid in full by the seller. This will result in the seller’s mortgage being written off.
• The notary then publishes the deed of cancellation in the land register. The land register is a report that determines the property rights. The deed of cancellation in the land register then allows the suppression of the right of ownership and then, its sale.
Required documents
During the visit to the notary, different documents will be requested.
For the buyer and seller
• Two pieces of identification that are valid, including one with a photo (e.g., driver’s license, health insurance card, passport, birth certificate, etc.),
• The detailed contact details of the parties,
• A marriage contract if you are married
• A judgment and divorce certificate if you’re divorced,
• A court file number if you are in the process of divorce.
For the buyer
• Mortgage instructions from your financial institution
• Proof of home insurance
For the seller
For more detailed information on these many mandatory documents when selling, see this article.
• The bill of sale,
• The mortgage deed,
• The certificate of location,
• Act of transmission if it is an estate,
• Statement of school and municipal taxes.
Documents specific to different types of properties
Divided co-ownership
• The declaration of co-ownership
• The DRCOP (Request for information to the syndicate of co-ownership). This document is completed by the union to ensure there is no arrears, special dues or other necessary information on the property.
Undivided co-ownership
• Joint ownership agreement
Plexes: duplex, triplex, quadruplex (...)
• Leases
• Notices of renewal or non-renewal
Fees payable to the notary
Fees are also involved in the transaction and will have to be paid by the buyer and seller.
Costs incurred by the buyer
• The chain of title to a property.
• Analysis of the certificate of location
• Copies of the bill of sale
• Preparation of allocations (e.g., school and municipal taxes, condo fees, revenues, heating oil)
• Registration in the land register of the deed of sale and the mortgage deed
• Notary fees (notary fees vary depending on the type of property, as well as its value)
Costs incurred by the seller
• Title correction (if required)
• Mortgage discharge:
○ Application to the creditor of the statement of account for repayment
○ Preparation of the mortgage discharge
○ Sending the draft discharge and repayment to the creditor
• Verification of taxes (municipal and school taxes)
• Administration of money in trust:
○ Preparation of cheques to various parties (real estate broker, land surveyor, mortgage creditor and payment of municipal taxes)
○ Preparing the transfer of funds to the mortgagee for repayment
• Bank transfer sales product:
○ Preparation of a bank transfer for the sale product and scan the confirmation into a file
○ It should be noted that picking up your cheque by hand avoids this cost
• Taxable disbursements (e.g., school and municipal tax audits)
• Notary fees: the notary’s hourly rate varies depending on the notary’s expertise and the urgency of the situation
In the case of a co-ownership
• Communication with the co-ownership manager or syndicate
○ Obtaining information relevant to the transaction (condo fees, union compliance, etc.)
○ Obtaining a copy of the syndicate co-ownership
○ Payment of condo fees, if applicable.
○ Sending information to transfer the Syndicate
In some situations, the notary may incur unexpected additional charges. This is important to expect. A popular example of additional costs is title insurance.
• Title insurance: title insurance is a damage insurance. When the notary examines the securities and the certificate of location, he/she can detect irregularities (risks). If the transaction takes place soon and there is not enough time to correct these irregularities, the notary can then find a title insurance provider to cover these risks. It is the buyer who will be the insured and the seller who will have to assume the payment of the premium due to the right of ownership to which he/she is bound.
Your real estate broker at your side
Don’t forget that your real estate broker is always at your side, even during the transition to the notary. If misunderstandings arise before, during or after the notary, do not hesitate to let your real estate broker know in order to clarify everything.
With this information in hand, whether as a buyer or as a seller, we hope that your transition to the notary takes place with confidence!
Summary
The sale of a property is formalized by signing the act of sale with the notary. However, documents are mandatory for both the buyer and the seller. For example, during the visit to the notary, each party is asked for two pieces of identification and, if necessary, marriage or divorce certificates. For the buyer, mortgage instructions from the financial institution as well as proof of home insurance are required. For the seller, several documents are necessary such as previous sales documents, the mortgage deed, the certificate of location and others.
In addition, fees must be paid by the buyer and seller. These fees differ. Among the costs incurred by the purchaser is the registration of the deed of sale in the land registry and the mortgage deed. At the seller, one of the fees is a mortgage discharge.
Although this last stage of the real estate transaction can be complex, know that your real estate broker is there to accompany you and answer your questions. Let him/her know your concerns. He/she’s here to provide his/her expertise.
Questions about going to the notary? Contact one of our real estate brokers to enlighten you on the subject.
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