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Do I need a lawyer to buy a house in Alberta?

Do I need a lawyer to buy a house in Alberta?

When you’re in the middle of buying a home—or even if you’ve just started to think about the process in detail―it’s easy to get bogged down in logistics. And once you’ve wrapped your head around the roles of buyer, seller, realtor, mortgage provider, appraiser, and maybe a builder or a condo board as well, contemplating what exactly a real estate lawyer does might be the last thing on your agenda.

But the role of a lawyer in the home buying process is important—and not as complicated as you might think. Below, we’ll address five vague, shadowy misconceptions that might be floating around in your mind.

Misconception 1: Lawyers are optional when purchasing a home.

While this might be true in some other provinces, where it is acceptable for a notary to oversee legal transfers of property, in Alberta it is mandatory to work with a lawyer when buying a home. It’s the lawyer’s job to make sure the transfer of land from seller to buyer is legally enforceable and binding.

Misconception 2: You don’t need a lawyer who specializes in real estate.

Actually, you don’t; the legal requirement for a lawyer’s participation the home buying process can be fulfilled by any lawyer authorized to practice. But that doesn’t necessarily mean it’s a great idea to hire the same lawyer who made your will to oversee your property transfer.

You want someone intimately familiar with the ins and outs of titles, property-related bylaws, inspections, and insurance—in other words, a real estate lawyer.

Misconception 3: Even when you’re working with a lawyer, liability remains squarely on the buyer’s shoulders.

Before the transfer of property is registered, the lawyer will check for any restrictions on the title, make sure the seller is the most-current owner of the property, and look over the “real property report”. The real property report is a document that describes property characteristics, such as the property line and whether or not the propane line to the BBQ in the backyard complies with municipal bylaws. If the lawyer misses something on the title, and there’s a problem later, it’s the lawyer—not the buyer—who’s liable for the cost of correction.

All that being said, one of the lawyer’s responsibilities is to make sure you, as the buyer, have interim title insurance to protect you from unexpected complications during the two-week title transfer process.

Misconception 4: Every lawyer will start charging by the minute as soon as you start asking them questions.

This is simply not true. It’s important to shop around and ask potential lawyers about their prices, and about what services those prices include. Most real estate lawyers are happy to sit down with a potential client and discuss any questions they may have before launching into the legal process. You’ll want to make sure that your lawyer has time, energy, and real estate acumen to devote to you and your new home.

Even before you talk to a lawyer, take the time to do your research. Just like you would before committing to a dinner reservation, look on the web for reviews. You can also check the Law Society of Alberta database to make sure that the lawyer you’re thinking of hiring doesn’t have any actions on record against them.

Misconception 5: It’s impossible to tell how much a lawyer will end up costing, when all is said and done.

Beyond asking a lawyer outright about their fees before you hire them, there is a fairly consistent ballpark range for a lawyer’s services in the transfer of a land title. You can expect to pay the lawyer’s fee as well as the lawyer’s disbursements, which are costs (such as courier fees, office administration fees, and land title and mortgage registration) that the lawyer cannot avoid incurring on your behalf. In Alberta, a real estate lawyer’s fee typically ranges from $600 to $1200 (plus GST), while disbursements might total $400 or $500. All in all, you should be budgeting between $1500 to $1700. Title insurance costs vary depending on the property value and insurance provider.

There’s so much to know when you’re buying a home, but it doesn’t have to be overwhelming. We created The ATB home buying guide to walk you through the process all the way from pre-approval, to decorating.
ATB Financial

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