Buying or selling property in Ontario does not end when someone accepts an offer. That moment is really the start. Once both sides sign the Agreement of Purchase and Sale, often the standard OREA Form 100, the legal and financial work kicks off.
From there, several steps have to happen before ownership changes hands. People call this stage the real estate closing. It means firm deadlines, detailed paperwork, and steady coordination between your lawyer, your lender, the real estate agents, and sometimes a municipal office.
A single missing document can push back your closing day. When you understand how the process works, you stay on track and skip the last minute panic. This guide walks you through each stage, what buyers and sellers need to do, what your lawyer handles, and the costs you should plan for. Read it once and you will know what comes next at every step.
When an Offer Becomes Binding
The process starts when a buyer submits a written Offer to Purchase. This is not a casual note. It is a legal document that sets out the full terms of the deal. In Ontario, most residential offers use the Ontario Real Estate Association standard form, known as OREA Form 100.
Once the seller reads the offer, they can accept it, reject it, or send back a counteroffer. When both sides agree on every term and sign, the document becomes a binding Agreement of Purchase and Sale. You can learn more about the standard forms through the Ontario Real Estate Association.
A few details carry the most weight in that agreement.
- The purchase price, which is the amount you agree to pay
- The deposit, usually held in trust by the listing brokerage
- The closing date, which sets when ownership transfers
- Conditions such as financing approval, a home inspection, or a condo status certificate review
- Clauses covering which items stay, any repairs, and how taxes and utilities get adjusted
Here is the part people forget. Once you sign, you can usually change the deal only by written amendment. Walk away without a valid contractual reason and you may lose your deposit or face a lawsuit. Because the agreement binds you, read it closely before signing, ideally with a lawyer looking it over first.
Meeting the Conditions in Your Agreement
If your agreement includes conditions, you have to meet them by the deadlines, or the sale stalls. Three conditions show up most often.
- Financing approval, where your lender confirms your mortgage
- Home inspection, where an inspector checks the property for problems
- Sale of your current home, if your offer depends on it
If a condition is not met, the buyer can often walk away with no penalty, depending on how the agreement reads. Once every condition is satisfied or waived in writing, the sale becomes firm and there is no easy turning back.
Title Search and Due Diligence
Once the deal is firm, your lawyer runs a title search to confirm the seller actually owns the property and has the right to sell it. Your lawyer hunts for anything that could affect your ownership.
- Liens or mortgages that must be cleared before closing
- Easements or rights of way that limit how you use the land
- Unpaid property taxes or utility bills
- Zoning or building rule problems
If something turns up, it usually has to be resolved before the closing date. This is how you end up with clear title and no nasty surprises down the road.
Finalizing Financing and Insurance
If you are using a mortgage, your lender does a final check on your income, your down payment, and sometimes a fresh appraisal. The lender then sends mortgage instructions straight to your lawyer, who prepares the documents for you to sign. Read them carefully and confirm the terms match what the lender promised.
You also need property insurance in place before closing. Most lenders will not release the mortgage money without proof the home is insured for at least the cost to rebuild it. For a condo, you usually insure your contents and carry liability coverage, since the condo corporation insures the building itself. Your insurer sends the binder to your lawyer, and another piece falls into place.
Closing Day Steps
Closing day is the handover. Here is what happens.
- Your lawyer sends the balance of the purchase price to the seller’s lawyer by bank draft or wire transfer.
- Once the seller’s lawyer has the funds, they release the signed transfer for registration in Ontario’s electronic land registration system.
- Your lawyer confirms the property is registered in your name.
- You pick up the keys from the brokerage or as your agreement sets out.
- The seller’s lawyer pays off the seller’s mortgage and any charges, then sends the rest to the seller.
After Closing, A Few Loose Ends
You have the keys, but a handful of tasks still matter.
For buyers
- Your lawyer sends written confirmation that the property, and your mortgage if you have one, is registered.
- Contact the utility providers to set up electricity, water, gas, and internet in your name.
- Make sure the municipality sends future property tax bills to you.
- If the seller agreed to any repairs, check that the work got done.
For sellers
- Your lawyer pays off your mortgage from the sale money and files the discharge with the land registry.
- Your lawyer pays the real estate commission before sending you the balance.
- Update your mailing address with your bank, service providers, and government offices.
Land Transfer Tax and Closing Costs
Land transfer tax is one of the biggest costs you face beyond your down payment. Ontario charges it on a sliding scale based on your purchase price. You pay a set rate on each slice of the price, not the top rate on the whole amount.
| Portion of the purchase price | Ontario rate |
| First $55,000 | 0.5% |
| $55,000 to $250,000 | 1.0% |
| $250,000 to $400,000 | 1.5% |
| $400,000 to $2,000,000 | 2.0% |
| Above $2,000,000 (one or two single family homes) | 2.5% |
The top 2.5% rate applies only to land that holds one or two single family homes. You can read the official rules on the Ontario government website.
If you buy in the City of Toronto, you pay a second municipal land transfer tax on top of the provincial one. Toronto is the only municipality in Ontario that does this, which roughly doubles your tax bill inside city limits. For most homes the city rate matches the provincial scale. As of April 2026, Toronto added higher rates on the portion of any price above $3,000,000. The City of Toronto publishes the full schedule.
With the average Toronto home price sitting above $1,000,000 in 2026, most city buyers land squarely in the higher brackets, so this cost is worth planning for early.
First time buyer rebates
First time buyers can claw back a real chunk of this tax. The province refunds up to $4,000, which wipes out the provincial tax on a home priced at $368,333 or less. Buy in Toronto and you can claim up to another $4,475 on the municipal tax. Stack both rebates and a qualifying first time buyer saves up to $8,475.
Other costs to budget for
- Legal fees and disbursements, which cover your lawyer’s time plus out of pocket items like title searches and registration
- Title insurance, which protects you against hidden title defects, fraud, and survey issues
- Lender fees, which some banks charge for administration or appraisal
A useful rule of thumb is to set aside 1.5% to 4% of the purchase price for closing costs, kept separate from your down payment. Sellers skip land transfer tax, but they still pay legal fees, the real estate commission, and a fee to discharge the mortgage.
Here is a quick side by side look at who pays what.
| Cost | Buyer | Seller |
| Land transfer tax | Yes | No |
| Legal fees and disbursements | Yes | Yes |
| Title insurance | Usually | No |
| Real estate commission | No | Yes, in most deals |
| Mortgage discharge fee | No | Yes, if mortgaged |
| Property insurance | Yes | Ends at closing |
Timing and Possible Delays
Most closings in Ontario take 30 to 60 days from the day you sign the agreement. Complex deals can run longer. A few things tend to cause delays.
- Financing problems, such as a slow lender or a last minute document request
- Title problems, such as an unresolved lien or an ownership dispute
- Document errors, such as a wrong name or a missing signature
- Municipal issues, such as a zoning or building code problem
You can keep things moving with a few simple habits.
- Reply fast when your lawyer asks for documents
- Lock in your financing well before the closing date
- Arrange your insurance early
- Confirm every condition is met inside the stated deadlines
How an Experienced Real Estate Lawyer Helps
A closing has a lot of moving parts, and a missed step can cost you money or your deal. The experienced real estate lawyers at Insight Law Professional Corporation handle the title search, the registration, the funds, and the paperwork, so you can focus on your move.
“Most closing problems are not dramatic. They are small things caught too late. Our job is to catch them early.” By an experienced real estate lawyer at Insight Law Professional Corporation
Are you buying as an investment or alongside a business? The steps overlap, but extra issues come up. If you are also buying a business in Ontario, the due diligence runs deeper. Many investors hold property through a company, so they handle business incorporation first and pick a business structure that fits their tax and liability goals.
Ready to move forward? Talk to a real estate lawyer in Toronto before you sign anything, and get a clear quote for your transaction.
Frequently Asked Questions
How long does a real estate closing take in Ontario?
Most deals close within 30 to 60 days of signing the Agreement of Purchase and Sale. The closing date is set in the agreement itself. Financing snags, title issues, or paperwork errors can stretch the timeline, so respond quickly to your lawyer to stay on schedule.
What does a real estate lawyer do at closing?
Your lawyer reviews the agreement, runs the title search, prepares and registers the transfer, handles the mortgage documents, moves the funds, and confirms the property is in your name. On the sale side, your lawyer pays off your mortgage and sends you the balance. In Ontario you need a lawyer to register the transfer.
How much is land transfer tax in Ontario?
Ontario charges land transfer tax on a sliding scale, from 0.5% on the first $55,000 up to 2.5% on the portion of a single family home price above $2,000,000. Buyers in Toronto pay a second municipal tax on top. First time buyers can claim rebates of up to $4,000 from the province and up to $4,475 in Toronto.
Can I back out after signing the Agreement of Purchase and Sale?
Once the agreement is firm, you are bound by it. Before conditions are waived, you can usually walk away if a condition is not met, for example if your financing falls through. After conditions are gone, backing out without a valid contractual reason can cost you your deposit and expose you to a lawsuit.
What closing costs should I budget for?
Plan for land transfer tax, legal fees and disbursements, title insurance, and any lender fees. A practical guideline is to set aside 1.5% to 4% of the purchase price, separate from your down payment, so closing day does not catch you short.
Do foreign buyers pay extra tax when buying in Ontario?
Yes. Non resident buyers face the provincial Non Resident Speculation Tax of 25% on many residential purchases across Ontario. The City of Toronto also charges a municipal speculation tax on foreign buyers. If this might apply to you, get legal advice before you sign, because the rules are strict.
The information provided above is of a general nature and should not be considered legal advice. Every transaction or circumstance is unique, and obtaining specific legal advice is necessary to address your particular requirements. Therefore, if you have any legal questions, it is recommended that you consult with a lawyer.
