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Buying a Home: Offer to Purchase

An offer to purchase is the form used to create the agreement between the buyer and seller. Once the offer to purchase is signed, the agreement between the parties is established, and your lawyer will be limited by the agreement with regard to their ability to assist you. Therefore, prior to entering into an offer to purchase you should investigate all matters of importance to you with respect to the home, or add conditions to the offer to purchase with regard to such issues as:

  1. That you are permitted to have a structural engineer or other qualified home inspector of your choosing conduct a home inspection which is to be satisfactory to you in your discretion;
  2. That the seller provide you with a building location certificate and zoning memorandum indicating that there are no encroachments onto or by adjoining properties and that the property complies with local zoning bylaws (discussed further below);
  3. That the offer to purchase be subject to your lawyer’s approval as to both form and content, with such approval to be given within a reasonable time (you should consult your lawyer in this regard before binding them to a condition they may not be able to meet due to illness, vacation or other reasons);
  4. That, if you need to sell your current residence prior to being able to complete the purchase of your new home, you insert an appropriate condition in that regard; and
  5. That if you are buying a property which is subject to subdivision, or is a vacant lot, that you are able to obtain a building permit.

There are many other considerations in an offer to purchase and you should seek the assistance of a realtor who will work with your lawyer, or if you have chosen to proceed without a realtor you should consult your lawyer.

Other questions you may ask prior to entering into an offer to purchase could include:

  • what the property taxes are or are expected to be for the home;
  • what amount of land transfer tax you should expect to pay to the provincial government when you purchase the home (discussed below);
  • what your monthly utility charges could be; and
  • whether the property is serviced by city, town, or municipal sewer and water or whether it has private well, septic field, or ejector system.

You should also contact the city, town or municipality responsible for the property tax to inquire regarding any existing or foreseen local improvements, development fees, or levies that may affect the property.

If you require financing to complete the purchase of your home, you should make sure that it is a condition of your offer to purchase that you have an opportunity to obtain appropriate financing and consult with your lender as to your financing needs as soon as possible. In particular, if you are selling a home and purchasing a new one you should also speak to your lender to inquire whether your require “interim” or “bridge” financing. Since you may not get the proceeds of the sale of an existing home immediately up the possession date of that home, you should not rely on funds coming from that sale to complete your new purchase. Your lender will be aware of this situation and can explain to you the interim/bridge financing options which most lenders provide.

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Notice: The articles on our website are provided for general information purposes only and should not be relied upon as legal advice or opinion. They reflect the current state of the law as at the date of posting on the website, and are subject to change without notice. If you require legal advice or opinion, we would be pleased to provide you with our assistance on any of the issues raised in these articles.