I am often asked the question: “Do I need a lawyer to sell my home?”
This question often surprises me, although, on the other hand, I can easily understand why many people are unsure why a lawyer is required to complete the seemingly easy task of selling a home.
The answer, by the way, is always a resounding, “Yes!”.
In the Province of Alberta, a lawyer is required and is essential to the process of selling a home. For this reason, a seller must retain a lawyer to assist with the legalities associated with a sale transaction.
Standard Sale Transaction – The Role of a Lawyer
1. When a seller hires a lawyer to complete the sale of a home, the seller is retaining that particular lawyer to act specifically on his or her behalf and to represent his or her sole legal interests. For example, a lawyer will review all pertinent documents for the sale transaction, including: the Sale Contract and all standard terms and special terms; the Real Property Report, if applicable; the land title certificate and any and all registered encumbrances; the property tax certificate; and any other related sale documentation.
The lawyer will further prepare all conveyancing documents required to complete the sale transaction and will meet with the seller for signing prior to the closing date. At the signing appointment, the seller will have the opportunity to ask the lawyer any unanswered questions he or she may have regarding the sale.
2. The lawyer is duly responsible for all payouts related to the sale matter. For instance, the lawyer will payout from the sale proceeds, any and all unpermitted encumbrances registered against the subject title. These unpermitted encumbrances may include the following: secured mortgage(s); caveats; and liens. Additionally, the lawyer will payout the following balances or arrears owing with respect to the sale property: real estate commissions; property taxes; condominium fees and/or special assessments; etc. Finally, once all required payouts have been completed, the lawyer will payout the net sale proceeds to the seller, if any, as directed.
3. In the final stage of the sale transaction, the lawyer will obtain and register discharge documents for any and all of the unpermitted encumbrances noted on title. The lawyer will also prepare a reporting letter to the seller detailing the money received and disbursed on the file as well as provide the seller with accompanying sale documents.
Non-Standard Sale Transaction – The Complication Factor
The expertise of a lawyer is particularly crucial when a sale transaction becomes more complicated than originally anticipated. Some of the complications which might arise from the sale of a home, include: issues related to the Real Property Report; disputes over holdbacks and undertakings; and conflict pertaining to the interpretation of Sale Contract terms. In order to navigate smoothly through a non-standard sale closing, the lawyer will act diligently on the seller’s behalf to ensure that his or her interests are reasonably and fairly considered. In the case where a sale transaction collapses and fails to complete, the lawyer will provide the seller with his or her possible courses of action and any other pertinent legal advice or referrals with respect to the matter.
When to Hire a Lawyer
Most sellers retain a lawyer after a Sale Contract becomes firm and all of the conditions have been waived. However, depending on the nature of the sale transaction, some sellers may require the assistance of a lawyer prior to the waiving of all conditions. For instance, a seller may seek legal advice pertaining to specific terms of the Sale Contract or questions relating to the Real Property Report. Oftentimes, it is beneficial to the seller to retain a lawyer early on in the sale process to avoid possible complications and issues down the road.