Demystifying the Agreement of Purchase and Sale–Title Search Clause #10 Part 2

Today’s topic is on the Title Search Clause in the Agreement of Purchase and Sale.  This is one of the most important “standard” clauses in the agreement.  What most don’t understand, or over look, is that this is a conditional clause.

Real estate professionals are not lawyers.  Our title search tools are limited, we rely on information provided by the sellers and support from Municipal and County resources, however, these resources are not infallible.  Only a lawyer can confirm absolute title to a property.  The Title Search Clause provides a safety net for both Buyer and Seller by allowing a search of a property to ensure title can indeed be exchanged as described in the Agreement.

The Title Search Clause allows for the Buyer’s lawyer, at the Buyer’s expense, to undertake this task prior to the date set out in clause #8 (more on clause #8 in another Blog).  This is an added cost to the Buyer and is usually incorporated in closing costs from the lawyer.  However, it is important to point out, that just like any other condition, at the Buyer’s expense, whether the deal closes or notthe Buyer will be absorbing this cost.  (I will have more details on “Conditional Clauses” in future Blogs.)

There are a whole host of things that a Buyer’s lawyer is looking for to satisfy this condition, I’m rewording them, here, in layman’s terms.

1.  The title to the property must be good and free of any registered restrictions, charges, liens and encumbrances (there are a number of exceptions to this which I have listed below)

2.  There must be no valid objection to title,

3.  There must be no outstanding work order(s)

4.  There must be no deficiency notice(s)

5.  The buyer must be able to lawfully continue the  present use

6. The principal building must be insurable against risk of fire

Each one of these unto themselves can be a full topic of discussion…in any case, for any doubt you should always seek legal advise.

If any of these issues are uncovered, it then becomes the responsibility of the Seller to remedy (fix) the problem(s), at the Seller’s expense.  One of the remedies is that the Seller may obtain Tittle insurance in favour of the Buyer (or any mortgagee).  It is important to note that any and all issues uncovered can re-open negotiations if both Seller and Buyer are willing.

If the Seller is unable or unwilling to remove, remedy or satisfy (the Buyer/Buyer’s lawyer) and the Buyer is unwilling to Waive this condition, the deal dies.  Any deposit money will be returned to the buyer without deduction.

By virtue of this clause, the Seller, Listing Brokerage and Co-operating Brokerage shall not be liable for any costs or damagesBuyer’s you must be made aware of this!

The clause finally concludes that if there is no valid objection to title the Buyer accepts possession of the property as outlined in the Agreement…there is no further document required to fulfill this clause (except for what a lawyer may request to complete the transaction).

Here is the actual clause:

Here are all the exceptions to the restrictions, charges, liens and encumbrances as per point #1 above…both Seller and Buyer need to be aware of these:

1.  Unless it is otherwise agreed upon in the Agreement by both parties

2.  Any registered restrictions or covenants that run with the land and are complied with

3.  Any registered Municipal agreements and registered agreements with public utilities, and are complied with

4.  Any minor easements for supply of domestic utility or telephone service to the property or adjacent properties.

5.  Any easements for drainage, storm or sanitary sewers public utility lines, telephone lines, cable tv lines or other services which do not materially affect the property.

Again, if in doubt about these exceptions always check with your lawyer.

There’s a lot to this clause and it is often just glanced over in the signing process.  ALWAYS READ AND UNDERSTAND WHAT YOU ARE SIGNING.  If in doubt…ask for clarification and/or seek legal advise.

Don’t forget to send your comments, stories, or ideas, in the comment section below or via email at dimaline@amtelecom.net.

Watch for my next Blog on….

Demystifying the Agreement of Purchase and Sale-Title Search Clause #8

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Kathy Dimaline is a Real Estate Broker for RE/MAX Grey Bruce Realty Inc.  The comments on this Blog are the opinions, only, of Kathy Dimaline and do not constitute any legal advice or legal opinion and does not represent the interests or opinions of RE/MAX Grey Bruce Realty Inc., brokerage.

© Copyright Kathy Dimaline, All Rights Reserved

Clean your Windows??

I bumped into these guys in Owen Sound and arranged for them to come to my place, on the Bruce Peninsula, to clean my windows for me…all 50 of them.  I was very impressed!

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Click on the photo to go to their website…ask for Matt (tell him I sent you)

Assessment too High?…Ask for Reconsideration

It’s about this time, just after MPAC releases their new assessments that I get calls regarding increases in value of your properties.  My response is “Always fight it!”.  Ask for a reconsideration…if you don’t, then you can expect continued increases in the future.

Begin by completing MPAC’s reconsideration form.  Here’s the link on their site:  http://www.mpac.ca/pdf/request_for_reconsideration_residential_2013.pdf

A word of caution:  Every time you fight an assessment MPAC is gathering more and more intelligence on your property and your neighbours…welcome to “Big Brother”.  The more information they have the better their intelligence for future use.

You can provide comparable sales information or assessment information of properties in your neighbourhood.  In my opinion, this task is a challenge for anyone, including MPAC.  We are in an area where there are so many variables on properties…we don’t have cookie cutter homes and cottages, we don’t have lots that are exactly the same size, shape or with the same features.  So, work with what you know and don’t be afraid to go onto MPAC’s website and search for comparable assessments…you can access up to 24 properties.

The only way for anyone to know the true value of a property is to sell it…and that won’t help your current taxation situation. You can ask a Real Estate Broker, like myself, to do an official opinion of value on your property based on comparable sales, however, in most cases it is likely that the opinion of value will be more than the assessment.  So, I say save your money on the cost of the appraisal and try for a reconsideration anyway.

I’m always available and happy to give you a quick assessment over the phone and if the MPAC assessment is way out of whack, then yes, get an official valuation.

If you just bought a property and you paid less than the assessment, you definitely should ask for a reconsideration…because, what you paid is the true market value.

It’s my opinion that if you don’t try you will never get it adjusted.

Don’t forget to send your comments, stories, or ideas, in the comment section below or via email at dimaline@amtelecom.net.

Watch for my next Blog on….

Demystifying the Agreement of Purchase and Sale-Title Search Clause

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Kathy Dimaline is a Real Estate Broker for RE/MAX Grey Bruce Realty Inc.  The comments on this Blog are the opinions, only, of Kathy Dimaline and do not constitute any legal advice or legal opinion and does not represent the interests or opinions of RE/MAX Grey Bruce Realty Inc., brokerage.

© Copyright Kathy Dimaline, All Rights Reserved

Welcome…

Welcome to my Blog!

Writing this blog is a way of keeping in touch with you on a regular basis.    The goal is to entertain you with articles that are light, upbeat and informative about life and real estate on the Bruce Peninsula

There are a lot of details and very specific requirements involved in buying or selling real estate on the Bruce Peninsula, and, there are a lot of details in the contracts required when buying or selling property. In sharing my knowledge and experiences I’m hoping that this Blog will assist you with your real estate decisions, now or in the future.

My door is always open…figuratively and  literally…by phone, email, social media and at the office at Ferndale where the showroom is open 7 days a week (7 to 7).  You can follow me on my websites at www.davismclay.com, and www.getoutofthecity.ca, on Facebook, Twitter, Pinterest, and on this Blog.

Don’t forget to send your comments, stories, or ideas, in the comment section below or via email at dimaline@amtelecom.net.

Watch for my next Blog on….

MPAC Assessments

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The comments on this Blog are the opinions, only, of Kathy Dimaline and do not constitute any legal advice or legal opinion and does not represent the interests or opinions of RE/MAX Grey Bruce Realty Inc., brokerage.

Lions Head Inn–$599,000 (#821)

Click photo for full listing details.

Click photo for full listing details.

IDEAL CENTRAL BRUCE PENINSULA LOCATION. Growing tourist community. Open year round, this establishment caters to locals, summer cottagers, tourists, Bruce Trail Hikers, boaters and winter enthusiasts. A well established Country Inn since 1996. The Restaurant, dining area, patio and pub area seats 104 people. Four guest rooms in the tradition of an Old English Pub. Covered outdoor patio has view of the Lions Head Harbour & Marina, there is also an enclosed patio ideal for cooler summer evenings. Turnkey Operation, business, building, land and chattels.

Stokes River Lot–$20,000 (#467)

Click on photo for full listing details.

Click on photo for full listing details.

Vacant lot backing on to the Stokes River.  Clearing in front is ideal for your new build.  Well treed at back of property with idyllic setting on the river.  Close to General Store and Sand Beaches on Lake Huron.  Year round road with hydro and telephone service available at the road.