Personal Real Estate Corporations (PREC)

Lawyers, doctors and dentists have long had the ability to incorporate for tax purposes. Finally, Tax Fairness for Ontario agents has come about with the passing of Bill 145, Trust in Real Estate Services Act, 2019, bringing long overdue Tax Fairness for Ontario real estate agents by allowing them to incorporate a Personal Real Estate Corporation (PREC) and enjoy the benefits of low corporate income tax rates.

ADVANTAGES  OF INCORPORATION: 1. Lower corporate income tax rates. 2. Wealth creation through tax deferral. 3. Lower effective personal tax. 4. Income splitting opportunities

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Finding your dream home is a milestone. But that doesn’t mean the home buying process is over. A common question we field is whether or not a property buyer should purchase title insurance. Title insurance is a form of insurance used to insure the buyer and their lender against loss or damage as a result of title defects.

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So, you’ve decided to sell your home—congratulations! Whether you’ve chosen to upgrade to a larger home or downsize to a smaller, cozier property, selling your home is a big deal.

Working with the right real estate agent and real estate lawyer can help make this exciting process as stress-free and smooth as possible; they can also help you prepare for all the necessary fees, especially the hidden costs of selling a house.

How much does it actually cost to sell your home and what fees should you prepare for? Keep reading as we break down some of the hidden costs of selling a house.

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If you’re currently looking to purchase a new condo, it’s important to do your research as well as to work with an experienced real estate lawyer. The last thing you want to do is purchase a condo on a whim and later find out that there are maintenance fees or regulations you weren’t aware of.

So, how do you ensure that you have all the important information you need about your prospective new home before you sign on the dotted line? That’s where a condo status certificate can help.

You’ve likely heard the term “status certificate” before, but what exactly is a status certificate and why is a status certificate important?

Here’s what you need to know about this invaluable document and the purpose of getting a status certificate.

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Even though the housing market has slowed during the global COVID-19 pandemic, the industry has adapted to the challenges and is taking advantage of online tools to accommodate people who are still interested in buying or selling. Buyers who already own a home will need to decide whether to buy a new house before selling the old one, or vice versa.

Here’s what you need to know about how to buy a house while selling your own in Canada.

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Firstly, we hope you and all of your families are doing well and observing as much as possible the directive to stay home and work from home as much as you can. These are difficult times and this is the best way to get through them.

However, although most of us are home as much as possible, many of you have questions about the impact of Covid-19 measures on existing or new closings. Below is the essential information that you need to know. The Bottom Line is that Real Estate transactions are still closing:

1. The Land Registry Office and Teraview system are digital and there is no expectation that they will be shut down at this time.
2. Lawyers have been declared an essential service and as such can remain open to complete real estate closings, although many are adjusting to working from home.
3. The Law Society has relaxed rules on Commissioning Affidavits and Declarations so lawyers are allowed to Commission sworn documents and Identify clients remotely using digital signatures and video interviews. Lawyers are signing clients remotely and banking online as much as possible. Also, the current circumstance has people thinking about estate planning and Wills, which often requires making sure title is held in joint tenancy so that if one person passes away the property automatically passes to the survivor. The Ministry of the Attorney General has advised that an emergency Order In Council has been made under s. 7.1 of the Emergency Management and Civil Protection Act with respect to the virtual commissioning and execution of wills. This means that people can both have their Wills and any Title Transfer required completed virtually.
4. Lenders are allowing lawyers to sign their documents through digital signature and remotely on mortgages for purchases and refinances, although some lenders are not or are doing so on an ad hoc basis.
5. Title Insurance companies have confirmed that their fraud coverage will apply to cover buyers and lenders accepting digital signatures and remote signing.
6. The law is not clear on whether Covid-19 measures can excuse the performance of a Residential Real Estate contract. The two most likely elements or doctrines of law to apply to the situation are Force Majeure clauses and Frustration of Contract.
7. Force Majeure: Unlike most Commercial agreements there are no Force Majeure clauses in the standard Orea Residential Resale forms. These are clauses which allow parties to be discharged from the obligations in the event of serious unforeseen circumstances.
8. Frustration of Contract: This applies to discharge parties from their obligations when through no fault of their own unforeseen events make completing the contract something almost completely different than what they had bargained for. Essentially, the parties’ reasons for entering into the contract have to be destroyed by the unexpected event. It would be difficult to establish this in a Residential Real Estate transaction. Frustration of Contract is a final options which require the parties to almost have no other alternatives or workarounds to limit or avoid losses. Given that registry systems, law offices and banks remain open it is unlikely to apply to residential real estate transactions.
9. Cooperation between the Parties and Lawyers: Given that the law is not clear, lawyers and clients are being advised not to take hardlines in instances where Covid-19 measures impact a party’s ability to close, as it is expected that courts will not look favourably on a party who is not reasonable or takes advantage of the current circumstance.
10. Covid-19 Clauses: Covid-19 clauses have been drafted to factor this reality into an greement:
11. Covid-19 Clause – more ways out, better for buyers as they are more likely to need a way out- although it does give both the buyer and seller more ways out: The parties agree and acknowledge that in the event that either the BUYER, SELLER, or any of their respective lawyers/notaries, relevant service providers, branches of Canadian Banks or other Lenders, Land Registry Offices or other Government Agencies become the subject of a Voluntary or Mandatory Covid-19 virus quarantine, closure or travel restriction prior to the time of completion herein which results in the Buyer or Seller being unable to complete the transaction on the completion date stated herein, the completion date herein shall be automatically extended at the request of either party for a period of up to ten (10) business days after such quarantine, closure or travel restriction order is lifted. Such extension shall be up to a maximum delay of sixty (60) days unless the parties otherwise mutually agree to further extensions. Upon the expiration of the maximum 60 day extension period either party may elect to terminate this Agreement, in the event of which both parties will be released from any liability or obligation to each other.
12. Covid-19 Clause -less ways out, better for sellers as the are less likely to need a away out- although it does give both buyers and sellers less ways out and confirms an obligation to Close: The parties herein acknowledge and agree that they are required to close this transaction notwithstanding any impacts of Covid-19, save and except the closing of the Land Registry Offices and all financial institutions. In the event that the closing herein cannot happen because of a shutdown/disruption in the operation of the Land Registry System and/or financial institutions, the completion date herein shall be automatically extended to the fifth business day following the date upon which the said shutdown/disruption ends and the Land Registry System and financial institutions reopen.
13. With many law offices closed, or lawyers working from home, clients should expect to have to wire funds to lawyers and key exchange arrangements to be made between buyers and sellers, perhaps with the help of agents.
14. Tarion has amended its rules about times for extensions and many builders are using the “Unavoidable Delay” provision to extend transactions.
15. Lawyers and all participants in the industry are being advised to be on high alert for possible instances of fraud because of the relaxed rules and video signing.

The situation is fluid with regular updates from the Law Society, Title Insurance, Lenders, and Governments so all of this is subject to possible change. We wish you good luck, health and safety during these difficult times.

Title Tips is not intended and should not be relied on as legal advice. For specific questions or situations, please feel free to call John Zinati for assistance.

If you are wondering what to do when buying a house for the first time, there is a lot of information available. Thanks to the Internet, there is no limit to the advice and resources you can find to help you make one of the biggest purchases of your life. But sometimes, the information can seem overwhelming. That’s why we’ve put together a first-time home buyer 101, so you’ll know what to look for when buying a house and can get plenty of valuable first-time home buyers tips. Keep reading for things first-time home buyers should keep in mind when buying property in Canada.

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Selling your home can be a stressful process but you can avoid it by selling directly to a real estate investor. These sales often allow sellers to skip steps like inspection contingencies and avoid appraisal concerns or issues with financing from the buyer. In some cases, even if you choose to sell to a traditional buyer, you may get a better offer from an investor, perhaps someone with limited contingencies and assurance of a quick close. Should you sell your house or property to an investor? The answer really depends on the situation you want. However, it is important to understand the pros and cons of selling your house to an investor compared to a traditional buyer. Here’s what you need to know, so you make the best decision.

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Are you wondering if you should sell your house for an all-cash deal? Chances are you want to sell it quickly and may need the money to pay off a debt or make another big purchase. Or, you may be wanting to avoid the contingencies of going through with a traditional mortgage. Whatever your reasons may be, it is important to fully understand what an all-cash house offer is, and how it may benefit or hinder you as you sell. Here’s all you need to know, plus some helpful advice.

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It’s no secret that people have been scammed by fake house buyers and/or sellers in the past. Even if you are desperately searching for a new place to live or really want to sell your house quickly, you need to keep your eyes our for scammers and protect yourself from making a grave mistake. Here are some important warning signs to determine if a house buyer or seller is fake. Keep these in mind as you house hunt or list your house for sale and be sure to hire a real estate lawyer to protect you and your assets through this process.

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