In recent weeks, I have been asked by several clients whether it’s necessary to have legal representation when buying or selling a property.

Let me begin answering this question by outlining the role a solicitor typically plays in any real estate transaction.

For a fee, a real estate lawyer will:

* conduct a property search to see if there are any existing mortgages or liens that need to be discharged on the property

* ensure the property complies with the city zoning requirements

* do a tax search to determine if the property taxes have been paid

* do utility searches (gas, hydro, water) to determine if there are any arrears

* prepare the land transfer tax affavidit

* ensure the vendor stated on the agreement of purchase and sale is the real owner

* ensure all encumbrances are removed

* on closing, electronically register the deed and mortgage (Whereas previously, lawyers or their conveyancers would physically go to the registry office and register the deed and mortgage, if applicable.)

It should be noted that a majority of lawyers today are utilizing title insurance on most properties which is eradiating the need to do many of the above searches. Most notably, if a solicitor obtained title insurance on a property, then they would not do utility searches, a property tax search, nor verify the city zoning requirements. This is because title insurance not only means that there’s good title on the property, but also that should any future problems in any of these issues arise, the insurance company will remedy them.

Of course, lawyers typically charge a fee for their services and, in addition to this, they bill sellers and buyers "disbursements,” which are fees paid by the lawyer on the client’s behalf to complete the transaction, including title search costs, courier charges and the like.

Also, lawyers will often review offers for their clients. This is particularly important when a client is buying a property from a builder and there are numerous pages and forms which typically favour the builder. (We at Team McDadi have time-tested clauses that act to ensure both sellers and buyers have their interests fully protected.)

Having read the above, it should be clear that legal representation is a very important component to any real estate transaction.

It’s also important to note that if you are a buyer and you require a mortgage, the banks (financial institutions) will not advance funds to a person who is not a member of the law society. Simply stated that means that if you are a buying a home and obtaining a mortgage (which is the vast majority of the buyers today), you will need a lawyer.

For a cash buyer, while there is no legal obligation to use a lawyer, as I have already stated, I would strongly advise obtaining their services.

On the flip side of the coin, sellers can opt to not have legal representation. Beware though — this would be challenging. At the very least, correspondence with the buyer’s solicitor would be very challenging for anyone who isn’t a lawyer. Furthermore, the lawyer for the buyer would, in all likelihood, not accept an undertaking from a non-lawyer seller to discharge any mortgages/liens, etc. Additionally, sellers’ with mortgages have to prepare a deed and deliver this deed to the buyer’s lawyer on closing. Today, this is typically done electronically and it would be very difficult to have a seller who isn’t a lawyer carry out this function.