Conveyancing Theory Test 3

Property Transfer Tax Return issued by [blank_start]Ministry of Finance[blank_end]

The Form C Release (Discharge of Mortgage) is executed by the:

Form A -Transfer is executed by the:

The PTT Return is executed by

An alternative means of financing (other than mortgage): [blank_start]Agreement for sale[blank_end] - [blank_start]Right to Purchase[blank_end]

In an Agreement for sale, the [blank_start]vendor[blank_end] is the mortgagee and remains [blank_start]registered owner[blank_end] until [blank_start]loan[blank_end] is [blank_start]paid[blank_end]

Form B - Mortgage is executed by the [blank_start]mortgagor[blank_end]

In a mortgage back to vendor, the vendor agrees to be the [blank_start]mortgagee[blank_end]

[blank_start]Conventional[blank_end] Mortgage: principal amount [blank_start]cannot[blank_end] exceed [blank_start]75[blank_end]% of lesser appraised value [blank_start]High Ratio[blank_end] Mortgage: PA [blank_start]exceeds[blank_end] 75% of lesser of appraised value. Mandatory for borrowers with down payment less than [blank_start]25[blank_end]%

Lender's considerations: Mortgage and Property Tax payments cannot [blank_start]exceed[blank_end] [blank_start]30[blank_end]% of purchaser's [blank_start]net income[blank_end]

List some of the Mortgage costs: -[blank_start]Application[blank_end] Fee -[blank_start]Appraisal[blank_end] Fee -[blank_start]Survey[blank_end] [blank_start]Certificate[blank_end] -[blank_start]Interest[blank_end] [blank_start]Adjustment[blank_end] -[blank_start]Legal fees[blank_end] and [blank_start]Disbursements[blank_end]

Amortization: [blank_start]years[blank_end] it takes to [blank_start]repay[blank_end] [blank_start]mortgage[blank_end]

Mortgage Term: [blank_start]time[blank_end] during which [blank_start]specific[blank_end] [blank_start]mortgage agreement[blank_end] is [blank_start]effective[blank_end]

Breakage Cost: [blank_start]prepayment[blank_end] [blank_start]penalty[blank_end]

Blended payments: [blank_start]equal[blank_end] payments consisting of amount applied to [blank_start]principle[blank_end] and to [blank_start]interest due[blank_end]. Paid [blank_start]each[blank_end] [blank_start]month[blank_end] during mortgage [blank_start]term[blank_end]

Closed mortgage: cannot be [blank_start]prepaid[blank_end], [blank_start]renegotiated[blank_end], [blank_start]refinanced[blank_end] prior to term expiration

[blank_start]Fixed-rate[blank_end] mortgage: interest rate set for pre-determined term (6 months - 25 years) and cannot be renegotiated

[blank_start]Variable-rate[blank_end] mortgage: payments fixed for period of one to two years although rates may fluctuate from month to month

[blank_start]Open[blank_end] mortgage: can be prepaid at any time prior to maturity without costs

[blank_start]Convertible[blank_end] Mortage: fixed-rate which offers same security as closed mortgage but which can be convert to longer, closed mortgage at any time without penalty

Statement of Adjustments: [blank_start]sets out[blank_end] all the [blank_start]financial aspects[blank_end] of [blank_start]conveyance[blank_end]

Only a purchaser's SOA is prepared

Debits to the Vendor: -[blank_start]Commission[blank_end] -[blank_start]unpaid[blank_end] taxes -[blank_start]Assumed[blank_end] Mortgage -[blank_start]Last[blank_end] [blank_start]Mortgage[blank_end] payment -[blank_start]Discharging mortgages[blank_end] and other [blank_start]charges[blank_end] -legal account to [blank_start]clear title[blank_end] -[blank_start]deposit[blank_end] given to vendor or solicitor -[blank_start]holdback[blank_end]

Holdback: [blank_start]secure[blank_end] [blank_start]obligation[blank_end] of [blank_start]vendor[blank_end]

Common holdbacks: -[blank_start]deficiency[blank_end] holdback -[blank_start]Strata Levy[blank_end] holdback -[blank_start]builder's lien[blank_end] holdback

Credits to vendor -[blank_start]purchaser price[blank_end] -[blank_start]paid[blank_end] taxes/utilities -[blank_start]tax account credit[blank_end]

Debits to Purchaser -[blank_start]purchase price[blank_end] -[blank_start]PPT[blank_end] -[blank_start]share[blank_end] of [blank_start]paid[blank_end] taxes -[blank_start]unpaid[blank_end] taxes -[blank_start]tax account credit[blank_end] -[blank_start]mortgage[blank_end] costs -[blank_start]legal account[blank_end]

Credits to purchaser -[blank_start]deposit[blank_end] -[blank_start]unpaid[blank_end]/[blank_start]estimated[blank_end] taxes -[blank_start]assumed[blank_end] mortgage -[blank_start]new[blank_end] [blank_start]mortgage[blank_end] [blank_start]proceeds[blank_end]

Undertaking: solemn [blank_start]promise[blank_end] [blank_start]enforceable[blank_end] by the [blank_start]courts[blank_end] and sanctioned by [blank_start]law society[blank_end] to do a [blank_start]certain action[blank_end]

undertakings must be signed by lawyer

undertakings should not be given by lawyer unless [blank_start]monies in trust[blank_end] and certain of [blank_start]ability[blank_end] to [blank_start]pay out[blank_end]

Authorizations: [blank_start]allow[blank_end] lawyer to [blank_start]take fees[blank_end] from [blank_start]trust[blank_end]

Purchaser's execution: -[blank_start]Statement[blank_end] of [blank_start]Adjustments[blank_end] -[blank_start]Authority[blank_end] to [blank_start]pay[blank_end] -[blank_start]Statement[blank_end] of [blank_start]account[blank_end] -[blank_start]Property Transfer Tax[blank_end] -[blank_start]Mortgage[blank_end] documents

Vendor's Execution: -Form [blank_start]A[blank_end] - [blank_start]Transfer[blank_end] -[blank_start]Statement[blank_end] of [blank_start]Adjustments[blank_end]

Mortgagee's execution: Form [blank_start]C[blank_end] - [blank_start]Discharge[blank_end] of [blank_start]Mortgage[blank_end]

Reporting Letter to purchaser with copies of: [blank_start]Statement[blank_end] of [blank_start]Account[blank_end] Form [blank_start]A[blank_end] [blank_start]Statement[blank_end] of Adjustments [blank_start]Authority[blank_end] to [blank_start]Pay[blank_end] Form [blank_start]B[blank_end]

Letter to vendor attaching: [blank_start]cheque[blank_end] for [blank_start]balance[blank_end] [blank_start]payable[blank_end] form [blank_start]A[blank_end] [blank_start]Statement[blank_end] of [blank_start]Adjustments[blank_end]

Letter to real estate company with cheque to pay [blank_start]commission[blank_end]

Procedures for pay-out, close-out and reporting -letter to [blank_start]purchaser[blank_end] -letter to [blank_start]vendor[blank_end] -letter to [blank_start]real estate[blank_end] company letter to [blank_start]mortgagee[blank_end] prepare [blank_start]application[blank_end] for [blank_start]state of title certificate[blank_end] - then send letter to [blank_start]purchaser[blank_end] enclosing it pay [blank_start]taxes[blank_end] write cheque from [blank_start]trust[blank_end] to pay [blank_start]fees and disbursements[blank_end]