Even though the acute threat of Covid-19 might not last long, things will take time before they completely return to normal – among them is the housing market. Since the wake of the pandemic, clients and realtors have been wondering whether the pandemic will affect real estate agreements. Many are either planning on buying, selling, mid-deal, or having a project underway.
If you have been having a set of questions surrounding Covid-19 and the housing market, you’ve come to the right place. In this section, we’ll answer the most frequently asked questions regarding the real estate agreements and how the pandemic has impacted such agreements.
There’s no reason why a safe compromise shouldn’t be worked out, especially if the visit was provided for in the agreement. This can be arranged by allowing only 1 buyer per visit. The buyer is expected to wear a mask, gloves, refrain from touching anything in the home, and only be allowed to see the home for a period not exceeding 20 minutes to ensure maximum safety.
Another option is for the seller to vacate the property early on the closing date. This will give the buyer a chance to enter the home for a final inspection. This option not only allows both parties to have a fair final inspection of the property but also enough time to close.
A final option is for both parties to agree to a zoom meeting. Here, the buyer will have a chance to watch the seller going around the entire home displaying all areas of concern.
There’s no reason for canceling a real estate agreement whether a buyer goes into quarantine, cannot obtain a mortgage or the property value decreases. A purchase and sale agreement can be extended or amended. Otherwise, the buyer shall be liable to the seller if they suffer any deficiency as a result of a resale.
The short answer is yes. Our law firm doesn’t have to meet the buyers and sellers in person. We allow the buyer and the seller to do all document signings via a video conference. Law firms that are registered as bill payees allow buyers to transfer the closing funds directly to their trust accounts. This can be done online to avoid long queues at the banks. Our law firm also transfers closing down payment through Electronic Fund Transfer to the sellers’ account after closing.
This is impossible since most of the staff are working remotely. Even if the system closes down, the closing will continue so long as the buyer has title insurance – which provides gap coverage and allows agreements to close as scheduled.
The buyers can send money to the sellers and in return receive the keys as they both await the land registry system to be up and running again. Should a lien or judgment arise in the intervening period, where a buyer risks losing the title, the buyer’s title insurance gap coverage policy will stop it.
Many clauses can be included in any agreement, especially during the pandemic. However, some of these clauses give sellers or buyers the right to terminate an agreement, spoiling the sales effort. To be on the safe side, use these 3 practical clauses:
Remember that even if the government registration system closes down, agreements can still close, provided there is title insurance gap coverage in place. Before introducing additional clauses into any real estate agreement – whether buying or selling, ensure you seek legal advice. Our real estate lawyer at North York is always here to guide you in these sensitive matters. Call us now +1 (416) 513 9418
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