We frequently get asked questions about legal fees on real estate transactions. There are a number of factors that can impact the cost of your real estate deal including, but not limited to, the following:

1. What type of file it is – purchase, construction mortgage, sale, or refinance;
2. If a sale, the number of payouts to be made by the lawyer (i.e. mortgages, taxes, utilities, strata charges, property tax deferment) and who those payouts are going to/whether registrable discharges are required (i.e mortgages, assignments of rent);
3. If it’s a purchase, whether or not you’re getting a mortgage (including a line of credit to be secured by a mortgage registered against the property);
4. If it’s a purchase, whether the property is a freehold single family home, strata property or lease land purchase;
5. Whether your lender (if any) requires title insurance (and whether they have a specific company that they require title insurance to be purchased through);
6. Whether the law firm charges a fee for ordering title insurance;
7. How many non-financial charges are registered against title that the purchaser is acquiring; and
8. How long of a turnaround time there is until closing.

The challenge for clients is to determine what each quote they receive includes and excludes so that they can compare equivalent quotes. As part of the transaction, there are typically a number of elements to the lawyer’s legal account including legal fees (for the services performed), out of pocket disbursements (required as part of the transaction such as Land Title Office charges, tax certificates, courier, etc. and can be fairly significant depending on the file) as well as goods and services taxes (GST and PST are applicable to some portions of the account but not others). This does not take into account adjustments on closing and property transfer tax, which are separate from the lawyer’s legal bill.

Some lawyers/law firms will quote their files as “all inclusive”. Sometimes, this will include all of the charges that the client will expect to pay except for title insurance which, if required, will generally be billed separately. Other lawyers/law firms will provide a quote which is exclusive of taxes or exclusive of particular disbursements. As the differences between these quotes can be fairly significant, it is important for clients who are comparing quotes to ensure that the comparisons are equal.

At Touchstone Law Group LLP, we quote our files all inclusive and that number is the only amount the client will be expected to pay on closing (subject to anything unforeseen arising or any additional instructions provided by the client) with the exception of title insurance, if required or requested by the client. If you have any questions with respect to this article, please do not hesitate to let our office know.

Author: Una Gabie

This information is general in nature only. You should consult a lawyer before acting on any of this information. This information should not be considered as legal advice. To learn more about your real estate needs, please contact our office at (250)448-2637 or any of our lawyers practicing in the area of estate planning at the following:

Una Gabie: una@touchstonelawgroup.com

Jennette Vopicka: jennette@touchstonelawgroup.com

Danielle (Dani) Brito: danielle@touchstonelawgroup.com