The decision to buy or sell a property is a significant one, and it involves…
What a Real Estate Lawyer Does to Close a Home Purchase in Ontario
Signing an Agreement of Purchase and Sale feels like the hard part of buying a home, but a real estate lawyer’s work is really just getting started at that point. Between the signed agreement and the day keys change hands, a lawyer handles a series of legal and financial steps that most buyers never see in detail, even though skipping any one of them could put the purchase at risk.
This guide covers:
- What happens when a lawyer reviews the purchase agreement and searches title
- How land transfer tax gets calculated and what first-time buyers should know
- What actually happens on closing day itself
- Why the statement of adjustments matters more than most buyers realize
At a Glance
| Step | What the Lawyer Does |
| Agreement review | Confirms the deal is binding, checks conditions and deadlines |
| Title search | Verifies clear title, checks for liens, charges, or claims against the property |
| Land transfer tax | Calculates the tax owed and any first-time buyer rebate |
| Mortgage instructions | Reviews the lender’s requirements and prepares closing documents |
| Statement of adjustments | Reconciles deposit, taxes, and other pro-rated costs |
| Closing day | Registers the transfer, transfers funds, releases keys |
Reviewing the Agreement and Searching Title
Once an Agreement of Purchase and Sale is signed, it becomes a binding contract, and a real estate lawyer’s first job is to review it closely rather than assume the standard terms cover everything. This means confirming the purchase price, deposit amount, closing date, and any conditions, such as financing or a satisfactory home inspection, are worded in a way that actually protects the buyer if something needs to change before closing. A poorly worded condition can leave a buyer without a real way to walk away from the deal if financing falls through or an inspection turns up a serious problem.
Alongside the agreement review, the lawyer conducts a title search on the property. This search checks the land registry for anything that could affect ownership, including outstanding mortgages, liens, easements, or other claims registered against the property. If the buyer is financing the purchase, the lender will also require this search before releasing mortgage funds, and the lawyer reports back to both the buyer and the lender on what the search reveals. Many buyers also have the option to purchase title insurance through their lawyer, which provides an added layer of protection against certain title defects that a search might not catch.
The title search sometimes turns up issues that need to be resolved before closing can proceed. A previous mortgage that was never formally discharged, an old lien from unpaid contractor work, or an easement that was never disclosed can all surface during this stage. When something like this appears, the lawyer works to have it cleared, whether that means confirming a mortgage was already paid off and simply needs the paperwork tidied up, or negotiating with the seller to resolve an outstanding claim before the closing date arrives. A buyer rarely sees this part of the process directly, but a title issue caught and resolved before closing is far less costly than one discovered afterward.
Calculating Land Transfer Tax
Ontario charges a land transfer tax on most property purchases, and it is one of the larger closing costs a buyer has to budget for. The tax is calculated using graduated rates that increase with the purchase price, starting at 0.5 percent on the first portion of the price and rising through higher brackets as the price increases. A real estate lawyer calculates the exact amount owed and arranges for the funds to be transferred to the province as part of the closing.
First-time buyers should know they may qualify for a rebate of up to $4,000 off the provincial land transfer tax, which fully covers the tax on homes priced at roughly $368,000 or less and reduces the amount owed above that threshold. Buyers purchasing in the City of Toronto face an additional municipal land transfer tax on top of the provincial one, though this does not apply to purchases in Mississauga or most of the surrounding GTA outside Toronto’s city limits. A lawyer confirms which rebates actually apply to a given purchase and claims them at the time of registration rather than leaving a buyer to sort out a refund application later.
What Happens on Closing Day
Closing day is when ownership of the property officially transfers from seller to buyer, and a lawyer coordinates several moving pieces to make that happen on schedule. Property transfers in Ontario are registered electronically through the province’s land registration system, which means the lawyer prepares and submits the transfer documents digitally rather than filing paper records at a courthouse. Alongside the registration, the lawyer prepares a statement of adjustments, a document that reconciles the deposit already paid, property tax adjustments, utility costs, and any other pro-rated expenses between the buyer and seller, arriving at the final amount actually due on closing.
The lawyer also handles the movement of funds on closing day, receiving the buyer’s remaining funds and the mortgage proceeds from the lender, then disbursing payment to the seller’s lawyer once the transfer is confirmed registered. Only after the registration is complete and funds have changed hands does the seller’s lawyer release the keys. For anyone navigating this process for the first time, working with a Real estate lawyer Mississauga buyers rely on can make the difference between a closing that goes smoothly and one that runs into last-minute delays over a missing document or an unresolved title issue.
Closings can be delayed by things that seem minor until they hold up the process. Mortgage instructions arriving late from a lender, a discrepancy between the purchase price and the mortgage amount approved, or last-minute changes to the statement of adjustments can all push a closing back by hours or, occasionally, days. A lawyer who has already prepared the documentation in advance and confirmed the numbers ahead of time is generally better positioned to resolve these issues quickly rather than scrambling on the closing date itself.
Buyers sometimes assume the lawyer’s role ends once the agreement is signed, when in practice most of the substantive legal work, the title search, the tax calculation, the mortgage coordination, and the closing day mechanics, happens in the weeks between signing and possession. A firm such as Gill and Alter Law generally starts this work as soon as a signed agreement is in hand, since several of these steps take time to complete properly and cannot be rushed the week of closing.
Summary
A real estate lawyer’s work on a home purchase spans from the initial agreement review through the title search, the land transfer tax calculation, and the closing day mechanics that actually transfer ownership. Each step protects a different part of the transaction, and skipping or rushing any one of them is where avoidable problems tend to surface.
Key Takeaways
- A lawyer reviews the Agreement of Purchase and Sale and conducts a title search before a purchase can safely close.
- Ontario’s land transfer tax uses graduated rates, and first-time buyers may qualify for a rebate of up to $4,000.
- Closing day involves electronic registration of the property transfer, a statement of adjustments, and the coordinated transfer of funds before keys are released.
Understanding what happens behind the scenes between signing and closing helps buyers see why the legal work on a home purchase is not just a formality tacked onto the end of the process.
Frequently Asked Questions
What does a real estate lawyer review before closing?
A lawyer reviews the Agreement of Purchase and Sale to confirm the purchase price, deposit, closing date, and conditions are properly worded, and conducts a title search to check for liens, claims, or other issues affecting the property.
How is Ontario’s land transfer tax calculated?
The tax uses graduated rates that increase with the purchase price. A real estate lawyer calculates the exact amount owed and arranges for payment as part of the closing.
Do first-time home buyers get a discount on land transfer tax?
Yes. Eligible first-time buyers may qualify for a rebate of up to $4,000, which fully covers the tax on homes priced at roughly $368,000 or less and reduces the amount owed on higher-priced homes.
What is a statement of adjustments?
It is a document prepared by the lawyer that reconciles the deposit already paid, property tax adjustments, and other pro-rated costs between the buyer and seller, arriving at the final amount due on closing.
How are property transfers registered in Ontario?
Property transfers are registered electronically through Ontario’s land registration system. The lawyer prepares and submits the transfer documents digitally as part of the closing process.
When do buyers actually get the keys to their new home?
Keys are typically released only after the property transfer has been registered and the funds have been confirmed transferred to the seller’s lawyer, which usually happens later on closing day itself.