"I have finally made the decision. I am going to put an offer on that new house. The plans look fantastic, the sales people are wonderful...but suddenly, they gave me this pile of paper and I don't know what to do with it! I am making the most important purchase I am ever going to make in my life, my first home, and I am not sure what I should do next." The first thing to do, whether you are buying a brand new condominium, a townhouse, a semi-detached, a link, or a fully detached home, is to find someone who can explain the process involved, in closing that piece of real estate you'll be calling home. The best person for the job is your lawyer.
You will need a lawyer who will take the time to explain all facets of the Agreement of Purchase and Sale and explain to you: - what you have to look out for,- the hidden costs involved, - and the little twists and turns that lead towards moving into that house.
A good lawyer will itemize the disbursements (out of pocket expenses) up front. Quite frankly, depending on your deal, you may spend between $500 and $650 on various searches and other matters on top of the basic legal fee. You should have an agreement with your lawyer as to any retainer and what will happen if there are problems during the transaction and how these problems could affect your fees.
The lawyer you select should be someone that gives you a level of comfort, who makes you feel like he/she is going to take care of any problems that may arise, and who will take the time to explain things to you and answer all your questions.
Once you've found the right lawyer and are aware of all the costs involved, what do you need to look out for in your Agreement of Purchase and Sale? Here are some examples:

• There may be things like a five per cent clause. This clause is included so that if it turns out your lot is up to 5 per cent bigger or up to 5 per cent smaller than originally stated, you must be satisfied with it. - There may also be clauses relating to subdivision costs, such as boulevard tree planting, walls and fences.
• Watch out for driveways! Is your driveway paving included? Does it include one paving coat or does it include the final coat? Do you have to pay extra for it?- Are you going to have to pay the cost of the installation and connection of your hydro meter and your water meters? A few builders pay for it, many do not.
• There may also be a cost to enroll your home in the Ontario New Home Warranty Program.
• Until the municipality releases the builder from his/her obligations, relating to grading, road paving, etc., another cost may be incurred for the security deposit that relates to those matters. These are all things that you need to talk to the builder or salespeople about.
• Another item which frequently shows up in Agreements of Purchase and Sale relates to lot and education levies. Make sure you either have this clause removed or put a fixed maximum into the Agreement.

  All of these costs should be capped. What does that mean? It means you need to know the full amount of money which could be extra to the initial purchase price youÕre to pay on the date of closing. To do this, you need the builder to agree in writing as to the full amount of money you have to pay for all those extras costs. There is nothing worse than closing your home and having your lawyer say you need an extra $3,000 you hadn't planned for. That is a generally recipe for disaster.

  In your Agreement of Purchase and Sale there should also be a clause that gives you the opportunity, before the deal is finalized, to have it reviewed by your lawyer, so that he/she can make any comments and suggestions. Now that everyone has reviewed the Agreement of Purchase and Sale and is satisfied with it, what's next?

• Do you have your mortgage in place? Always make sure that your mortgage commitment is in writing from your financial institution.
• Make certain that it is approved and that all the necessary pieces of paper that have to be there are completed and ready. This is not something your lawyer does, this is something you do. You do the running around, making sure that these commitments are completed. Bring the mortgage commitment letter to your lawyer to ensure he/she is satisfied and that you are protected and that you do in fact have a mortgage when the time comes to close.
  
• Are you going to life insure your mortgage? Before you make that decision and you accept the bank's life insurance, make sure you do a comparative analysis with a few private insurance companies.

As the closing day approaches, you will get a call from your lawyer's office, telling you how much money you are going to need and when you will bring the money in. That money will be in the form of certified cheques or bank drafts. You will also need to sign the necessary closing documents.
One of the most important things you will do prior to the closing of your new home is the pre-delivery inspection pursuant to the Ontario New Home Warranty Program. This may be the only chance you get to obtain builder or government warranty coverage. It is therefore very important that when you do the inspection you do it slowly and carefully - don't miss anything!
When you attend your lawyer's office for the closing, make sure the he/she takes the time to explain to you what each document represents and what it is you're signing. Everyone should review the mortgage documents carefully ensuring that the interest rate and payment schedule are correct. The next step is to get your money together, give it to your lawyer and wait for the call to notify you that your home is closed and now legally belongs to you.
Ordinarily with new subdivisions, you will get your keys at the sales office and away you go...
Hopefully the information I have provided is helpful. Just remember it is only the beginning - make sure you get good, solid legal advice and listen to your lawyer as he/she has your best interest at heart.

Jayson Schwarz is a senior partner with the law firm Schwarz, Gillen Barristers and Solicitors. He can be reached at (416) 486-2040, toll free at 1-888-609-8888 and by fax at (416) 486-3325.

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