How do I read my closing documents?
How do I read my closing documents without leaving money on the table? Read this first.
Why this matters — read once, keep thousands
You’re selling your Georgetown home. The offer looks clean. You’re excited. Then the lawyer emails a stack of closing documents three days before closing and the numbers don’t match what you expected.
That moment decides whether you leave with the right money or a surprise bill. Read this and you’ll know exactly what to check, line-by-line, and how the closing process plays out in Georgetown, Ontario.
The quick roadmap every home seller in Georgetown needs
- Compare the closing package to your Agreement of Purchase and Sale.
- Read the Statement of Adjustments line by line. Check prorations. Confirm deposit.
- Verify mortgage payoff and discharge details.
- Confirm legal fees, realtor commission, and any local charges.
- Confirm net proceeds and wire timing.
- Ask your lawyer one precise question: “Show me each number that changes my net proceeds.”
If steps 1–5 line up, you close. If not, stop and get answers.
What are the core closing documents — and which ones you must read
- Agreement of Purchase and Sale (APS): The original contract. Use this as your baseline.
- Statement of Adjustments (closing statement): The single most important page. Shows purchase price, deposits, prorations, credits and debits, and your net proceeds. Read it first.
- Mortgage payoff statement: Shows what the bank will accept to discharge your mortgage. Includes penalties, interest, and fees.
- Transfer deed / Transfer/Deed document: The legal paperwork that transfers ownership. Confirm buyer name and closing date.
- Lawyer’s retainer and disbursement statement: Lists legal fees and extra charges for registrations, courier, title insurance.
- Title insurance certificate / statement (if applicable): Protects buyer but may show exceptions or local charges.
How to read the Statement of Adjustments — step-by-step
This is the money sheet. It tells you what you’ll receive. Open it and do this:
- Confirm the sale price and buyer name. Must match the APS.
- Verify deposit: Confirm the deposit amount and whether it’s been credited. If the buyer’s deposit isn’t there, contact your agent immediately.
- Check prorations: Property taxes, water, utilities, condo fees (if any), and prepaid items. These are prorated to the closing date. Formula to check: (annual amount ÷ 365) × number of days.
- Look for mortgage payout: This should match the bank’s payoff statement. If it’s higher, ask why.
- Confirm realtor commission: Compare to the listing agreement. Commission reduces your net proceeds.
- Watch for legal fees and disbursements: Make sure they are reasonable and itemized.
- Check land transfer tax / HST entries: In resale home sales in Ontario, HST typically does not apply to the property sale. Land Transfer Tax usually applies to the buyer — not the seller. If it’s shown on your statement as your charge, get clarification.
- Recalculate the net proceeds: Sale price – mortgage payout – commissions – legal fees – adjustments = your net proceeds. Check the math. If anything is off, flag it.
Practical examples Georgetown sellers see
- Property tax prorations in Halton: You might owe or be credited for taxes based on the closing date. If the municipality charged a large final bill or there was an outstanding installment, that will appear in adjustments.
- Local improvement charges or outstanding municipal liens: The Region of Halton or Halton Hills may have outstanding charges that must be cleared before title transfer. Watch for these in the title search or the lawyer’s reports.
- New-build vs resale: If you sold a new-build or assignment, HST rules and rebates may affect the closing documents. Ask your lawyer to explain the HST entries.
Red flags that require an immediate call
- Deposit missing or credited incorrectly.
- Mortgage payoff larger than the bank’s payoff statement.
- Commission differs from the listing agreement.
- Unexplained last-minute fees or adjustments.
- Title issues or liens not disclosed in the APS.
- Closing date changed without agreement.
If you see any of the above, pause. Don’t sign. Call your lawyer and your agent.
How lawyers handle the flow of funds in Georgetown closings
Your lawyer collects buyer funds, pays off mortgages and liens, registers the transfer, and wires your net proceeds. Typical timeline:
- 48–72 hours before closing: Lawyer sends closing package and Statement of Adjustments.
- Closing day morning: Buyer’s lender funds the lawyer.
- Lawyer pays off mortgages and any liens, registers the deed, and pays municipal charges.
- Midday to end of day: Lawyer wires net proceeds to your account or issues a certified cheque.
Ask your lawyer for the expected wire date and keep your bank details current.
Simple checklist to read your closing documents (printable)
- Agreement of Purchase and Sale — names, sale price, closing date.
- Statement of Adjustments — sale price, deposit, prorations, mortgage payout, commission, legal fees, net proceeds.
- Mortgage payoff — outstanding balance, penalties, interest.
- Transfer deed — buyer name, legal description, closing date.
- Title report — liens, local improvement charges, encumbrances.
- Lawyer’s instructions — wire details and ID verification.
How to calculate prorations yourself (fast formula)
- Find the annual amount (taxes or condo fees).
- Divide by 365 to get daily rate.
- Multiply by number of days buyer owns after closing (or seller’s days to closing, depending on who owes).
Example: $3,650 annual taxes ÷ 365 = $10/day. Closing on day 120: prorated amount = $10 × 120 = $1,200 credit or debit based on contract.
Common misconceptions — cleared
- “My lawyer handles everything, so I don’t need to read.” Wrong. Your lawyer protects legal transfer. You still own the financial risk. Read the money sheet.
- “HST always applies.” Wrong for most resale homes. HST can apply to new builds or commercial transactions.
- “Closing day is always smooth.” Not always. Fund delays, lender issues, or title problems can delay closing.
Local market insight — Georgetown, ON specifics that affect closing papers
- Halton property tax timing: Check whether property taxes were recently reassessed or billed. Reassessments or back-billed amounts may appear in adjustments.
- Rural properties and utility certificates: If the property uses well or septic, certificates or compliance costs may show up. Buyers sometimes request repairs or credits right before closing.
- Condos and parking/locker adjustments: If you sold a condo, check that monthly condo fees and any special levies are prorated properly.
One proven negotiation move before signing
If the Statement of Adjustments changes numbers that reduce your net proceeds, call the buyer’s agent and your lawyer. Ask for a clear written explanation for each change. If it’s a math error, demand correction. If it’s a negotiated credit, confirm it with the buyer in writing.
Final checklist before you sign or authorize the wire
- Deposit confirmed in the statement.
- Mortgage payout matches your lender’s payoff statement.
- Realtor commission equals listing agreement.
- Adjustments and prorations make sense and are correctly calculated.
- Net proceeds match your expectations.
- Lawyer confirms registration and wire timing.
Contact for local help
If you want a second set of eyes on your closing documents, get local help. I review closing statements for Georgetown sellers and explain each line in plain language.
Contact: Tony Sousa — tony@sousasells.ca | 416-477-2620 | https://www.sousasells.ca
FAQ — Closing Process for Georgetown Home Sellers
Q: What is the Statement of Adjustments and why is it crucial?
A: It’s the final money sheet. Shows sale price, deposit, prorated taxes/utilities/fees, mortgage payout, commissions, legal fees, and net proceeds. If it’s wrong, your money is wrong.
Q: Who pays land transfer tax in Georgetown?
A: The buyer normally pays the Ontario Land Transfer Tax. Sellers rarely pay it on resale residential sales. If you see a charge for land transfer tax on your statement, ask why it’s there.
Q: What closing costs will the seller typically pay?
A: Mortgage discharge fees, legal fees, real estate commission, any agreed seller credits, and outstanding local charges or liens. Check the APS for any negotiated seller-paid items.
Q: How soon do I get my net proceeds after closing?
A: Typically same day or within 24–48 hours after registration and receipt of funds from the buyer’s lender. Your lawyer will confirm the wire date.
Q: What if the mortgage payoff is different from the lawyer’s figure?
A: Don’t sign. Ask your lawyer to get an updated lender payoff statement. Banks calculate daily interest; last-minute payoffs can differ. Confirm the final figure before release.
Q: Can closing be delayed? What happens to my move-out plans?
A: Yes, delays happen. If funds aren’t received or title issues arise, closing can shift. Keep contingency plans for moving and coordinate with your lawyer and agent.
Q: Do I need title insurance?
A: Title insurance typically protects the buyer. Sellers don’t usually buy title insurance, but the title search will reveal issues that must be cleared before closing.
Q: Who handles utility adjustments and final meter readings?
A: The lawyer handles prorations but you and the buyer should confirm final meter readings and account transfers with local utilities. Leave clear instructions for the buyer if needed.
Q: What are typical legal fees in Georgetown?
A: Legal fees vary. Expect a base fee plus disbursements for registrations, courier, and title searches. Ask for an itemized estimate when your lawyer sends the retainer.
Q: How can I avoid surprises on closing day?
A: Read the Statement of Adjustments early, verify mortgage payoffs, confirm deposit is credited, and ask your lawyer to walk you through each number before you sign.
If you want a quick review of your closing documents, send them to tony@sousasells.ca or call 416-477-2620. I’ll explain each line and protect your proceeds.
