First Home Savings Account (FHSA)

• Once you have found a house you would like to buy, it’s time to make an offer to the seller. This is typically done through a real estate agent or a lawyer but can also be drafted yourself. Your offer must include:
  • Your legal name, the name of the seller, and the address of the property
  • The amount you’re offering to pay (the purchase price) and the amount of your deposit
  • Any extra items you want included in the purchase such as window coverings
  • The date you want to take possession
  • A request for a current land survey, if applicable
  • The date the offer expires
  • Any other conditions that must be met before the contract is finalized. For example, financing approval or a satisfactory home inspection
• Once you have an accepted offer to purchase, contact your financial institution to confirm mortgage details if you’ve been pre-approved or to begin the financing approval process.

• A lawyer is required to purchase a house. A lawyer will:
• • Obtain mortgage instructions from your financial institution
  • Confirm property taxes are current
  • Contact your insurance agent to confirm house insurance is in place
  • Prepare purchase and mortgage documents and meet with you to sign them
  • Obtain the purchase funds from you and your financial institution
  • Send the purchase funds to the seller's lawyer
  • Ensure the seller’s mortgage and any unwanted liens are removed from the title
  • Register the transfer and mortgage documents at the Land Titles Office

• Closing costs vary depending on the price of the house and the requirements of your financial institution. Most house purchases involve the following closing costs:
  • Legal fees
  • Survey or title insurance fees
  • Land transfer tax
  • Land Titles Office fees
  • Tax certificate fee

• Closing costs vary depending on the price of the house and the requirements of your financial institution. Most house purchases involve the following closing costs:
  • Legal fees
  • Survey or title insurance fees
  • Land transfer tax
  • Land Titles Office fees
  • Tax certificate fee

• A survey, also known as a building location certificate, is a sketch of the property prepared by a licensed surveyor that details the location of all buildings on the property.
• A survey can confirm that the buildings and structures purchased are located within the property lines, and/or that it is free from encroachments by buildings or structures on adjoining properties.

• Instead of getting a new survey you can obtain title insurance. Title insurance is intended to cover you for any loss you suffer in the future as a result of not having obtained a new survey.
• Title Insurance is generally less expensive than a survey.

• Land transfer tax is collected by the government when transfers of land take place. It is paid for by the buyer when the transfer is sent to the Land Titles Office. Land transfer tax is included in the closing costs that the buyer pays to the lawyer typically at the time of signing documents.
• The amount of the tax is based on the fair market value of the property.

$1 - $30,000 = 0.00%

$30,001 - $90,000 = 0.50%

$90,001 - $150,000 = 1.00%

$150,001- $200,000 = 1.50%

$200,000 + = 2.00%

‍

• Before the possession date, you should set up your utility accounts by contacting:
  • Manitoba Hydro
  • Municipal water department (if there is municipal water service)

• You should arrange your house insurance well in advance of the possession date, but the policy does not have to be in effect until the actual date of possession.
• Your financial institution will require confirmation that they have been listed as first loss payable on your house insurance policy.

• If more than one person is to be the owner, you should consider whether you wish to take title as “joint tenants” or as “tenants-in-common,” the main difference being what happens to the property upon death of either co-owner.
• As joint tenants, when one of you dies, the survivor is automatically entitled to ownership of the entire property.
• As tenants-in-common, the survivor shares the property with the deceased person’s heirs.

• A property tax adjustment is either added to the purchase price or deducted from the purchase price, depending on whether the possession date is before or after the property tax due date. This is calculated by and paid to the appropriate lawyer.
• If the possession date is before the date the taxes are due in your municipality, a tax adjustment is usually deducted from the purchase price. It is calculated as:

(Net taxes/365 days) x (# of days in the year before possession date)

For example: February 1 is the possession date

January 1 to February 1 is 31 days

Net taxes for year are $1,200.00

($1,200.00/365) x 31 = $101.92

• If the possession date is after the date the taxes are due in your municipality, a tax adjustment is usually added to the purchase price. The tax adjustment is calculated as:

(Net taxes/365 days) x (# of days in the year including and after possession date)

For example: December 1 is the possession date

December 1 to December 31 = 31 days

Net taxes for year are $1,200

($1,200.00/365) x 31 = $101.92

‍