Steps in a Typical Residential Real Estate Transaction

Step #1: The purchaser and vendor enter into an agreement of purchase and sale for the property. Most purchasers sign the agreement without the benefit of a lawyer, although the assistance of a lawyer is recommended.

Step #2: The purchaser and vendor each get a lawyer to act for them on the transaction.

Step #3: The purchaser's lawyer does a title search and off-title searches to determine if there are any problems with the property. Purchaser's lawyer does this because it is the purchaser's responsibility to investigate title and raise any problems by a "requisition date" as set out in the agreement.

A title search is done at a Registry Office (or online, if available); depending on the type of property, the purchaser's lawyer may have to go back through records for 40 years.

Off-title searches are done largely to ensure that there are no adverse financial interests that the purchaser will have to deal with, for example, tax or hydro arrears.

Step #4: The purchaser's lawyer sends out requisitions to the vendor's lawyer asking him/her to clear up certain problems (if any) before the transaction closes.

Step #5: A transfer/deed is prepared by the vendor's lawyer and the mortgage is prepared by the purchaser's lawyer. Other non-registerable documents are prepared and exchanged on or prior to closing. The preparation of documents may vary in electronic registration jurisdictions.

Step #6: The representatives of the two sides meet on the day of closing at the appropriate Land Registry Office to exchange money and documents and to register the transfer (and any mortgage in the transaction), unless electronic registration is being used by the two law firms.

Step #7: After closing, each lawyer prepares a reporting letter to their client (for the purchaser, the lawyer's opinion or title insurance policy, including TitlePLUS title insurance) on the state of title and the property.

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