Six things to do before purchasing a house

Article revised on 28 February 2020

Are you about to purchase your first home? Purchasing a house is a major investment and exciting event! It’s where you’ll invest your savings and start making your dreams come true. However, there are many things to check and know to ensure you make a wise choice. Here’s a list of things to check before you commit to purchasing a home.

1. Before you begin the process of purchasing a house, learn about Legal Access insurance

If you already hold home, auto or leisure vehicle insurance, it might be a good idea to add Legal Access insurance to your coverage before you start the process of purchasing a home. You’ll get support if you run into problems or if you have legal questions. You can also consult the notary or lawyer of your choice throughout the process without incurring all the expenses.

2. During the purchase offer, do your due diligence with regard to home insurance

As soon as you plan to make your purchase offer, contact your insurer to get an idea of how much your home insurance premium would cost, but above all, to make sure the property is not exposed to certain risks which may make it difficult for you to get insured (e.g. non-compliant home or located in a flood-risk area).

3. Inspect the residence, and have it inspected

Did you know that you are responsible for detecting any visible signs of defects or potential problems with the home you’re considering purchasing? The building inspector has an equally important part to play. He or she is responsible for detecting anything that is visible, just like the buyer, but as an expert in the field, the inspector should be able to spot problems easier than most of us. Keep your eagle eyes peeled and make sure you check everywhere to avoid any unpleasant surprises!

4. Before signing a purchase contract, make sure it’s exactly what you want!

Many people believe that they have up to 10 days to cancel their purchase offer. This applies only if you sign a preliminary contract with a contractor or developer for the construction of a new house or condominium.

5. Understand the significance and importance of the documents to complete, provide and obtain during the transaction

• Purchase offer form 

Typically, the buyer and seller fill out this form together, and may be assisted at times by a real estate broker. This is an important form because it outlines each party’s intent. As a buyer, make sure the sale price appearing on the form matches the negotiated price. Then, check to see if all the conditions you desire are included, such as the financing, inspection and sale of your property. Remember to respect the deadlines for meeting your conditions. Otherwise, you risk losing your rights.

• Seller’s declaration 

You should obtain this document before signing the purchase offer.

• Certificate of location 

The seller must provide this document. Go through the certificate of location carefully and notify your notary if there are any discrepancies between the property and the certificate.

• Proof of financing 

This document will be provided to you by the institution financing the purchase of your home. You will need it to complete the transaction if the offer is conditional on financing.

6. To validate titles and finalize the transaction, hire a notary

In Quebec, notaries see to the buyer’s interests during a real estate transaction. Once the purchase offer conditions are met, as a buyer you must hire a notary and pay the fees.

The notary will perform a title search which includes checking for any irregularities (e.g. encroachment with a neighbour’s property) and preparing the transfer of titles. To do so, your notary will need the purchase offer, proof of financing and the certificate of location.

If the title search leads to the discovery of a problem or irregularity, the notary may suggest you take out title insurance to cover the expenses incurred to correct the situation.

Happy shopping and don’t forget to consult a notary or lawyer if you have any questions along the way!

 

Additional resources:

What do you do about latent defects in your home?

Landscaping: How to avoid disputes with your neighbours