Here is a brief explaination of the Ontario real estate sale forms used. These are the ones you will generally use in most residential transactions in the Province.
- Agreement of Purchase and Sale. This is sometimes referred to as the 'offer'. It will contain all terms and conditions with respect to the sale and purchase of a property. The Buyer and Seller will be bound by everything stated on the Agreement.
- Schedule attached to the Agreement. It is common to have a Schedule 'A' that forms part of the Agreement between the Buyer and Seller. It is a separate piece of paper that is an extention of the Agreement. On the original Agreement form, it will state that there is a Schedule 'A' attached.
- Waiver. Most Agreements will contain conditions that must be met before the the Buyer or Seller agrees to proceed with the transaction. An example of these are financing, home inspection and sale of another property. When the Buyer has determined that the financing is approved or they will accept the home inspection report, they will waive condition to notify everyone involved with the transaction. This is a piece of paper they sign that states they are removing their condition and everything is a go.
- Amendment to the Agreement of Purchase and Sale. This form is used when the Buyer and Seller agree to change something on the original offer form. It could be changing the closing date, the price, adding or deleting someones name, etc. Both parties must sign the Amendment before it becomes part of the Agreement.
- Mutual Release. This is the form that both Buyer and Seller will sign to terminate an Agreement. Suppose the Buyer was not able to arrange their financing. With the condition in the Agreement, it will allow the Buyer to walk from the deal. The Mutual Release 'kills' the Agreement between the 2 parties. It also states on the form what will happen to the deposit paid by the Buyer. In most cases, it is returned to them.
There is a separate Agreement of Purchase and Sale used for a condo transaction. It will contain details like the Condominium Plan No., current monthly condo fees paid by the Seller and so on.
All real estate transactions MUST be in writing. A hand shake is no longer is acceptable.
So if you want the cute little shelf on the wall in the living room or the appliances, make sure they are included on the Agreement of Purchase and Sale. The Agreement is where everyone will turn to in order to determine what the Buyer and the Seller have agreed to. Make sure everything is on the form before you sign it. It may be too late afterwards.
We recommend that you consult with your lawyer before you sign any legal document.
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