We know that buying your first home is an exciting time, from the time when you start house until you finally have the keys in your hands. If you want this process to work smoothly, it is crucial to anticipate all the fees you will have to pay apart from your mortgage and your deposit. These additional charges are the closing costs, and one of the main ones is the lawyer fees for buying a house.
Maybe some people might be wondering, is it necessary to pay legal fees for buying a house in Ontario? The answer is yes. You can’t handle the final steps of the purchasing process on your own, you need a real estate lawyer. Even when the lawyer will help you in the end, we recommend finding one at the beginning, before making an offer to purchase. Having a real estate lawyer in the early stages will ensure you complete all the mandatory paperwork, pay all the fees and be ready to close the sale.
Since lawyer fees for buying a house in Ontario are an unavoidable bill, you will have to pay. Below we will explain to you what exactly you will be paying and what things are included in the lawyer fees when buying a house. However, it is important to remember that lawyer fees will vary depending on the law firm and even the province. But, because we want you to have an idea of how much are lawyer fees for buying a house, we are going to give you an approximate estimate.
Choosing the right real estate lawyer
Before we get into all the tasks that your lawyer fees for buying a house include, you need to know how to choose a real estate lawyer. This is an important decision because your lawyer will be in charge of all the documents required to complete the sale.
We know that there are amazing law firms that you could hire in Ontario, but if you want to choose the best one for your case, there are things you need to look out for. We know that most people worry about the cost because they don’t want to exceed their budget. In this case, we recommend putting the legal fees for buying a house in Ontario in second place.
When looking for a real estate lawyer, you should first evaluate their experience, make sure they know what they are doing. You can even prepare a list of questions before you go into their office.
The next thing you need to keep in mind is communication. You should choose someone who you feel comfortable talking to, there is no need to have a headache each time you go into your lawyer’s office.
Once you make a decision, let the law firm know. That way, they can start working on your case.
Lawyer fees for buying a house in Ontario
When you hire a lawyer to help you with the purchasing process of a house, you will be paying them for all the time they spend on your case. As mentioned before, the lawyer fees when buying a house vary depending on the firm, but all of them calculate the cost based on the number of hours.
Overall what is included within the lawyer fees for buying a house, is how much time they spend answering your questions, talking with the seller’s lawyer, drafting your documents and reviewing all the paperwork.
If you want to look at some development options in Ontario, check out this post.
What to expect from the lawyer fees
Within the legal fees for buying a house in Ontario, there are a series of tasks included. Here is an overview of the process that a real estate lawyer will execute when you are purchasing a property.
- Analyze the Offer to Purchase: when you pay your lawyer fees for buying a house in Ontario, the law firm will help you review the offer to purchase.
- Title search: your lawyer will make sure there are no other claims towards the property and that it is ready to be transferred to your name.
- Tax search: As you know, every house owner has to annually pay a property tax. Depending on the time of the year when you finish the purchase, you might have to reimburse the seller, or you could have credit in your favour. Either way, your real estate lawyer will take care of this.
- Receive the instructions from the bank or alternative lenders regarding your mortgage.
- Complete and prepare all the mandatory documents to apply for a mortgage.
- Title Insurance: Through your real estate lawyer, you can obtain title insurance, which will protect you from any claims somebody makes towards your new property.
- Sign all the necessary paperwork.
- Closing costs: the person you hire will also help you calculate all the closing costs to prepare you for the final steps of the purchasing process.
- Request the release of the mortgage funds for the closing date and transfer these funds to the seller’s lawyer.
- They will register the mortgage and report it to the lender or the bank where you request it.
- Create and review the statement of adjustments.
- Complete the land title and provide it during the closing date.
What are the disbursements in the lawyer fees when buying a house?
This is a question the majority of people have when they take a look at the bill from their lawyer and find a section called disbursements. Disbursements refer to all the costs the lawyer paid on your behalf to complete all your paperwork.
Some common disbursements are government taxes, banking fees, travel expenses (only in special cases), among others. This amount you will have to pay back to your lawyer.
How much are lawyer fees for buying a house?
The lawyer fees for buying a house could cost you between $500- $2000. But, it all depends mainly on the location. In Canada, real estate lawyers are more expensive in the cities compared to rural areas.
Final Thoughts
Now that you know everything regarding legal fees for buying a house in Ontario, the only thing you need to do is find the perfect real estate lawyer. Keep in mind the lawyer fees are just one part of the closing costs. There are other additional costs that you will need to pay before being the owner of your new property.
