What’s a statement of adjustments?
What’s a statement of adjustments? Don’t close your sale until you read this.
You’re selling a home in Georgetown. You need numbers that don’t surprise you on closing day. The statement of adjustments is the single document that lays out who pays what — and who walks away with what.
This post explains exactly what a statement of adjustments is, why it matters for Georgetown sellers, how to read one, and how to avoid last-minute shocks. Read it. Use it. Close with confidence.
Quick answer: What’s a statement of adjustments?
A statement of adjustments is the closing worksheet prepared by your lawyer or notary. It lists the sale price, deposits, credits and debits, prorated items (property taxes, utilities, condo fees), mortgage payout, commissions, legal fees and the final net proceeds to the seller. It shows who pays what, for the period up to closing.
Think of it as the final scorecard for the deal.
Why it matters for home sellers in Georgetown, ON
- It tells you the exact cash you’ll receive at closing. No guesswork.
- It prevents last-minute funds gaps that can delay closing.
- It ensures municipal items, like Halton Hills property tax adjustments, are handled properly.
- It accounts for prepaid items or credits the buyer deserves after closing.
In Georgetown, municipal billing, utility connections, and any region-specific levies must be prorated correctly. The statement of adjustments is where those numbers live.
Who prepares the statement and when
Your lawyer (or the buyer’s lawyer) prepares the statement of adjustments in the days before closing. In Ontario transactions, the seller’s lawyer will usually review the buyer’s statement and issue a final version. You should get a copy at least 48 hours before closing so you can review it.
If you don’t see it early, ask for it. Don’t wait.
How the statement of adjustments is organized (what to expect)
Most statements follow this structure:
- Sale price and deposit(s)
- Adjustments in favour of seller (credits)
- Adjustments in favour of buyer (debits)
- Seller’s disbursements (mortgage payout, commissions, legal fees)
- Net proceeds to seller (what is wired to your account)
Read each line. Every dollar matters.
Common line items explained (Georgetown-specific notes)
- Sale price: The agreed price on your listing agreement.
- Deposit: Held in trust by the listing brokerage; applied against the purchase price.
- Property taxes: Prorated to closing date. In Georgetown (Town of Halton Hills), taxes or local levies are adjusted for the exact number of days you owned the property that tax year.
- Utilities and final bills: Hydro or water final readings may be adjusted. If the seller prepaid a water account, the buyer receives credit for post-closing consumption.
- Condo common expenses: If you’re selling a condo in Halton Hills, monthly condo fees are prorated and the buyer is credited for owner-paid periods after closing.
- Mortgage payout: Your lawyer must obtain a mortgage payout statement from your lender. The payout amount and any discharge fees go on the statement and reduce your net proceeds.
- Real estate commission: The commission amount agreed in your listing contract.
- Legal fees and disbursements: Lawyer costs for closing the sale, title searches, courier fees, etc.
- Adjustments for rental income or tenant deposits: If a tenant remains after closing, rents and security deposits are adjusted.
Simple example that proves the point
Imagine you sell a Georgetown home for $800,000. Numbers simplified for clarity.
- Sale price: $800,000
- Deposit paid: $60,000 (credited to seller)
- Mortgage payout: $300,000 (debit)
- Real estate commission: $32,000 (4% on first $100k? — example only; use your contract figure)
- Legal fees & disbursements: $2,000 (debit)
- Property tax adjustment: Seller owes $1,200 for Jan–closing (debit)
- Utilities credit to buyer: $150 (credit)
Net proceeds to seller = $800,000 – $300,000 – $32,000 – $2,000 – $1,200 + $60,000 + $150 = $524,950
The statement of adjustments shows this line-by-line. No surprises.
Mistakes that cause problems — and how to avoid them
- Waiting until the last minute to review the statement.
- Ask your lawyer for a draft at least 48–72 hours before closing.
- Missing mortgage discharge fees or penalties.
- Request a mortgage payout statement early. Confirm any prepayment penalties.
- Forgetting prorated municipal charges unique to Halton Region.
- Confirm property tax periods and local charges with your lawyer and check with Town of Halton Hills if unsure.
- Overlooking tenant or rental adjustments.
- If your property has tenants, clarify rent and deposit transfers before closing.
- Assuming deposit funds are enough.
- Deposits reduce the buyer’s balance. They don’t cover all seller disbursements. Use the statement to confirm net proceeds.
Don’t guess. Use the document.
How to read the statement fast (what to check first)
- Net proceeds: Is the final number what you expected? If not, stop and ask why.
- Mortgage payout: Is the payout figure recent? Did it include discharge fees?
- Commissions and legal fees: Match them to your listing contract and retainer.
- Tax and utility adjustments: Do dates, amounts and prorations make sense for the closing date?
- Deposit application: Ensure brokerage trust funds are correctly applied.
If any line doesn’t match your expectations, ask your lawyer for a breakdown.
Specific tips for Georgetown sellers
- Municipal adjustments: Property taxes and any local services billed by the Town of Halton Hills or Halton Region are prorated. Confirm the tax year and whether any special levies apply.
- Closing day logistics: Many Georgetown closings are coordinated with local lenders and title insurers. Confirm wiring instructions with your lawyer and verify them by phone to avoid fraud.
- Local utility accounts: Hydro One and local water accounts may require final meter readings. Arrange final readings early.
- Buyers moving in rural-edge Georgetown properties: If your property has private utilities (well, septic), outline responsibilities in writing and ensure adjustments or allowances are clear.
Local knowledge reduces delays.
Who pays what after closing? (why adjustments exist)
Adjustments split costs fairly between buyer and seller for the period each owns the property in a tax or fee cycle. The buyer shouldn’t pay for the seller’s share of the year, and the seller shouldn’t pay for the buyer’s future months. The statement of adjustments enforces that fairness.
What if you disagree with the statement?
- Raise concerns immediately with your lawyer and the buyer’s lawyer.
- Most issues are clerical and can be corrected in time for closing.
- If the problem is more serious (e.g., unexpected mortgage discharge penalty), negotiate who pays or delay closing until resolved.
Don’t sign anything you haven’t reviewed.
Final checklist before closing day
- Get the draft statement at least 48 hours before closing.
- Confirm mortgage payoff and any penalties.
- Verify commission and legal fee amounts.
- Check municipal tax adjustments with Town of Halton Hills records if needed.
- Confirm wiring instructions and bank details with your lawyer.
Tick these boxes. Close without stress.
Why have an experienced local realtor on your side
Numbers can be small, but errors cost big. A local realtor who knows Georgetown can:
- Spot incorrect local adjustments.
- Coordinate early with your lawyer and the buyer’s team.
- Ensure final utility and municipal items are handled cleanly.
That’s why sellers who work with local experts avoid closing day surprises.
Contact for sellers in Georgetown
If you want a clear, no-nonsense review of your statement of adjustments or help coordinating closing in Georgetown, contact Tony Sousa. He handles local closings and makes sure the numbers add up.
Tony Sousa — Georgetown Realtor
Email: tony@sousasells.ca
Phone: 416-477-2620
Website: https://www.sousasells.ca
FAQ — Statement of adjustments and the closing process (Georgetown sellers)
Q: When will I receive the statement of adjustments?
A: Usually 48–72 hours before closing. Ask your lawyer for a draft sooner if possible.
Q: Who prepares it?
A: Your lawyer or the buyer’s lawyer prepares it. The seller’s lawyer reviews and signs off.
Q: Does the seller pay land transfer tax?
A: No. In Ontario, the buyer pays land transfer tax. The statement will not list land transfer tax as a seller debit.
Q: How are property taxes handled in Georgetown?
A: Property taxes are prorated to the closing date. The Town of Halton Hills and Halton Region bills or levies will be adjusted so the buyer pays post-closing days and the seller pays pre-closing days.
Q: What if my mortgage payout is higher than I expected?
A: Request a current payout statement from your lender immediately. Confirm penalties, discharge fees and the exact payout date.
Q: Can adjustments delay closing?
A: Yes. Incorrect or missing figures, withheld mortgage payoff info, or wiring issues can delay closing. Review the statement early to prevent delays.
Q: Do I need to be at closing?
A: Typically no. Your lawyer handles the closing and wires funds to your account. You may attend if you want.
Q: What should I watch for in the statement?
A: Net proceeds, mortgage payout, commission, legal fees, tax and utility adjustments, and deposit application. Verify all figures.
Q: Who resolves disputes over the statement?
A: Usually the sellers’ and buyers’ lawyers negotiate corrections. Most disputes are clerical and resolved before closing.
Selling a home in Georgetown? The statement of adjustments is your closing map. Know it. Review it. Don’t sign until every line makes sense.
Need help reviewing your statement or walking through your closing? Contact Tony Sousa at tony@sousasells.ca or 416-477-2620.
