Selling your house privately in Ontario is a viable option if you want to avoid the costs and commissions associated with real estate agents. While handling the sale on your own means you’ll take on more responsibilities, it can save you money and give you control over the process. However, it also means that you’ll need to be familiar with the paperwork required for a successful private sale. Here’s a rundown of the essential forms you’ll need when selling your home without an agent.
Agreement of Purchase and Sale (APS)
The Agreement of Purchase and Sale (APS), also known as Form 100, is the most crucial document when selling a house privately in Ontario. This form, issued by the Ontario Real Estate Association (OREA), outlines the key details of the sale, including the price, deposit, closing date, and any conditions that need to be met before the deal is finalized.
The buyer typically fills out this form, often with the help of their lawyer or advisor, and then submits it to you, the seller. Once you receive the APS, it’s essential to review the terms carefully, preferably with a lawyer, to ensure everything is in order before agreeing to the terms. Here are some critical elements of the APS:
- Sale Price: The offer price is the amount the buyer is willing to pay for your property. It’s essential to ensure that this price aligns with your financial goals.
- Deposit: This part of the form outlines the amount the buyer will put down as a deposit to show their commitment to the purchase. For cash buyers, this deposit may be higher, reflecting their intention to close the sale quickly.
- Closing Date: The closing date is when ownership of the property officially transfers to the buyer. Cash sales often allow for a quicker closing, sometimes within days or weeks.
- Legal Description of the Property: This section includes the precise address, lot number, and legal identifiers for the property. Accuracy is vital to avoid any issues during the sale process.
It’s always a good idea to consult with a lawyer when reviewing the APS to ensure all terms are in your best interest.
Seller Property Information Statement (SPIS)
The Seller Property Information Statement (SPIS) is an optional form, but it can be useful when selling privately. The SPIS allows you to disclose any known issues or defects with the property, providing transparency to potential buyers. While it’s not legally required, failing to disclose known issues could result in legal trouble if the buyer discovers problems after the sale.
For example, if your house has had a history of water damage, it’s wise to include this information in the SPIS. Being upfront with buyers can prevent misunderstandings and build trust, making the sale process smoother.
Mortgage Discharge Form
If you still have a mortgage on the property, you’ll need to arrange for a discharge of the mortgage before you can transfer ownership to the buyer. A mortgage discharge is a legal process where you pay off your remaining mortgage balance, and the lender releases their interest in the property.
Here’s what you need to know about the Mortgage Discharge Form:
- Discharging the Mortgage: When you sell your property, the buyer (or their lender) will want to ensure that the property is free of any liens or mortgages. You must complete a discharge of mortgage to transfer a clear title to the new owner.
- Assumable Mortgages: If you have an assumable mortgage, meaning that the new buyer can take over your mortgage, this form may not be required. However, most sales involve clearing the existing mortgage.
- Discharge Statement: After paying off the remaining balance, your lender will provide a Mortgage Discharge Statement, which is a legal confirmation that the mortgage has been fully paid. Your lawyer or the buyer’s lawyer will handle registering this discharge with the land registry office.
Title Search
A title search is usually done by the buyer’s lawyer to verify that there are no outstanding liens or legal issues associated with the property. However, as a seller, you should ensure that your property’s title is clear before listing it for sale. This will help you avoid delays during the closing process.
A title search includes checking for any claims, liens, or other encumbrances that may affect the property’s ownership. If any issues arise, they should be resolved before completing the sale.
Statement of Adjustments
The Statement of Adjustments is prepared by your lawyer to outline any costs that need to be settled between the buyer and seller before the sale is finalized. This document details things like prepaid property taxes, utility bills, and any other expenses that need to be adjusted based on the closing date.
For example, if you’ve paid property taxes up to the end of the year but sell the house in July, the buyer would owe you a prorated amount for the remaining months. The Statement of Adjustments ensures a fair distribution of these expenses, so both parties pay their share.
Bill of Sale
The Bill of Sale is a simple document that officially transfers ownership of the house from you to the buyer. It includes the property’s legal description, the purchase price, and the names of both the buyer and seller. This document is signed at the time of closing and is used in conjunction with other closing paperwork.
Identification Documents
You will need to provide valid identification documents during the sale process. This is required for legal purposes and to verify your identity when signing documents with your lawyer or notary. A government-issued photo ID, like a driver’s license or passport, is typically required.
Seller Customer Service Agreement (For MLS Listings)
If you want to list your property on the Multiple Listing Service (MLS) to attract more potential buyers, you may need to fill out a Seller Customer Service Agreement. This agreement allows you to work with a brokerage for a “flat fee MLS listing,” where your property is posted on the MLS without engaging in a full-service realtor contract.
The Seller Customer Service Agreement specifies the services provided by the brokerage, such as listing the property, making modifications, and removing the listing once the sale is complete. This can be a cost-effective way to get your property more visibility while still maintaining control over the sale.
Utility Transfer Forms
Before the closing date, make sure to inform your utility providers about the change in ownership and transfer or cancel services such as electricity, water, and gas. Some utility companies may require specific forms to be completed to update account information. Handling this in advance will ensure a smooth transition and prevent you from being charged for services after the sale.
Final Steps for Selling Privately in Ontario
Once you have all the necessary forms in order, the final steps involve reviewing the documents with your lawyer, arranging for the transfer of funds, and signing over the title of the house to the new buyer. While the process may seem overwhelming, having a clear understanding of the paperwork can make selling your house privately in Ontario a smooth experience.
If you’re considering a private sale but still have questions or want to explore your options, feel free to reach out to professionals who can provide guidance through each step of the process. For more information about selling your house quickly, you can visit Ontario Property Buyers.
Frequently Asked Questions About Selling Privately in Ontario
1. Do I Need a Lawyer to Sell My House Privately in Ontario?
Yes, it is highly recommended to hire a real estate lawyer when selling your house privately. They can help you review the Agreement of Purchase and Sale, handle the discharge of your mortgage, and ensure that all legal documents are correctly completed.
2. How Much Can I Save by Selling Privately?
By selling privately, you can avoid paying realtor commissions, which are typically around 5% of the sale price. This can save you thousands of dollars, especially if your house is valued at a higher price point.
3. Can I Sell My House As-Is to a Cash Buyer?
Yes, cash buyers often purchase houses in their current condition, which means you don’t have to spend time or money on repairs. This can make the process faster and more convenient for sellers who need to sell quickly.
Selling Privately Can Save You Time and Money
Selling your house without a realtor in Ontario gives you more control over the process and can save you money on commissions. With the right paperwork in order and the support of a real estate lawyer, you can handle the sale smoothly and confidently. Whether you’re looking to sell fast or just want to keep more of your earnings, private sales offer a great opportunity for homeowners in Ontario.
For those ready to sell their property quickly in Ontario, understanding the paperwork and steps involved is the first step toward a successful transaction.
