A Buyer's Guide to Typical Documents When Purchasing a Property

So you can feel confident and knowledgeable throughout the Property Buying process, below are descriptions and explanations of the typical documents required for the purchase of a home or property.

Typical Documents include: 

• Disclosure of Representation In Trading Services

• Privacy & Consent

• FINTRAC ID Requirements

• Buyer Agency Acknowledgement

• Disclosure of Expected Remuneration

• The Contract Of Purchase & Sale

• Buyer’s Right of Rescission

• Removal of Subject Appointment of Conveyancer

• FINTRAC - Receipt of Funds

Go here for an Explanation Video of the Standard Forms from BC Real Estate Association

DOCUMENTS UPON SUBMITTING AN OFFER

DISCLOSURE OF REPRESENTATION IN TRADING SERVICES

This document explains the different types of relationships you can have with a real estate agent when buying, selling, or leasing property. If you disclose confidential information to an agent, you should understand what type of business relationship you have with them.

If you are a client of a real estate agent, they work on your behalf and have special legal duties to you. These include loyalty, full disclosure, avoiding conflicts of interest, and confidentiality. You may be asked to sign a written agreement setting out your and the agent's responsibilities.

If you are not a client of a real estate agent, they do not owe you special legal duties. They may represent a client with competing interests to yours and do not have to give you all relevant information. They must share any information you tell them with their clients in a transaction.

Whenever an agent works with you, whether you are their client or not, they have a responsibility to act honestly and with reasonable care and skill. The disclosure form in compliance with sections 54 of the Real Estate Services Rules, which is required by law, is included in the document. The agent must present this document along with the Your Relationship with a Real Estate Professional information page.

If you have any questions or concerns about the information presented, you can contact the BC Financial Services Authority (BCFSA). They are a regulatory agency that works to ensure real estate professionals have the skills and knowledge to provide you with a high standard of service.

Go here to view an Explanation Video from the BCFSA

The PRIVACY NOTICE AND CONSENT form is a legal document that explains how personal information is collected, used, and shared by real estate professionals in British Columbia when selling, buying, or leasing a property. Personal information includes details about you, such as your name, address, phone number, and financial information.

Your personal information may be collected by the real estate agent you work with, the real estate board they belong to, and other parties involved in the transaction. This information will be used to market your property, help you find a suitable property, facilitate the transaction, and conduct statistical analysis.

Your personal information may also be disclosed to third parties, such as photographers, appraisers, and other service providers, and to regulatory bodies, such as the British Columbia Financial Services Authority (BCFSA) and The Canadian Real Estate Association (CREA).

You have the option to opt out of secondary uses of your personal information, such as receiving communication from other real estate professionals or participating in surveys.

By signing the consent form, you acknowledge that you understand how your personal information will be collected, used, and shared. If you have any questions or concerns, you can contact the real estate agent you are working with or the British Columbia Real Estate Association (BCREA).

FINTRAC ID Requirements: 

SHORT: FINTRAC requires Canadian real estate professionals to comply with anti-money laundering regulations by providing government-issued identification during transactions to verify party identity. Non-compliance can lead to significant penalties, making compliance crucial for protecting both professionals and clients.

The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) is a government agency that aims to combat money laundering and terrorist financing activities in Canada. As part of their efforts, FINTRAC requires that all real estate professionals, including real estate agents and brokers, comply with anti-money laundering regulations when dealing with real estate transactions.

This means that when buying or selling any interest in real estate, it is necessary to provide government-issued identification, such as a driver's license or passport, to verify the identity of the individuals involved in the transaction. This is done to ensure that the parties involved in the transaction are legitimate and not using real estate as a means to launder illicit funds.

In British Columbia and across Canada, failure to comply with FINTRAC's requirements can result in severe penalties and fines.

Therefore, it is essential for real estate professionals to understand and comply with these regulations to protect themselves and their clients from potential legal consequences.

Go here for an Explantion Video from the BC Real Estate Association

BUYER AGENCY ACKNOWLEDGEMENT

This document is called the Buyer Agency Acknowledgement and it is a form that a real estate agent presents to a buyer who is looking for a property to purchase. The form acknowledges that the buyer is asking for assistance from the real estate agent, who is known as the Buyer's Brokerage.

The form designates an agent to act as the sole agent for the buyer and sets out the duties and obligations of the Buyer's Brokerage and the designated agent.

The form also outlines that the designated agent will not disclose any information obtained through the buyer's agency relationship to other licensees who represent other buyers or sellers, unless authorized by the buyer or required by law. It is important to note that the agency relationship only exists between the buyer and the designated agent, and not with the Buyer's Brokerage.

The form also sets out the obligations of the Buyer's Brokerage, such as supervising the designated agent, treating all parties impartially, and holding all monies received in trust.

The form outlines that the designated agent is not obligated to make the buyer aware of all properties that meet the buyer's requirements, and that the Buyer's Brokerage may terminate the agency relationship at any time.

The form also outlines the conflicts of interest that may arise and how they will be handled, such as if the designated agent represents both the buyer and the seller of a property. Finally, the form states that signing it does not obligate the buyer to pay any remuneration directly to the Buyer's Brokerage or the designated agent, unless otherwise agreed to by the parties.

DISCLOSURE OF EXPECTED REMUNERATION

This document explains that the real estate agent must disclose any commission or referral fee they will receive in connection with the transaction.

This includes any payments made directly or indirectly to the agent. The document is divided into four sections: Client Notice, Disclosure of Commission, Acknowledgement of Receipt, and Disclosure of Licensee. The Client Notice section explains that the agent is required to disclose any remuneration they receive.

The Disclosure of Commission section requires the agent to disclose the amount of remuneration they will receive, and who will pay it. The Acknowledgement of Receipt section requires the client to sign the document to acknowledge that they have received and understood the information.

The Disclosure of Licensee section requires the agent to disclose their license information and any other relevant information. The document is necessary to protect the client and ensure transparency in the transaction.

The Contract of Purchase and Sale (CPS) is a legal agreement outlining terms and conditions of real estate property sale in BC. Includes price, deposit, completion date, possession date, terms and conditions/subjects. The contract template was developed & set forth by the British Columbia Real Estate Association & the Canadian Bar Association (BC branch).

For a Quick Video explaining the CPS click here>>>

***Please Go Here >>>for a Detailed Explanation ***

DOCUMENTS BETWEEN AN ACCEPTED OFFER & CLOSING

DISCLOSURE: BUYER’S RIGHT OF RESCISSION

As a buyer of residential real property in British Columbia, you have the right to cancel your Contract of Purchase and Sale by serving a written notice on the seller within three business days after the date on which the acceptance of the offer was signed. This is called a rescission right and cannot be waived.

Your real estate agent is required to provide this disclosure to you when preparing or presenting an offer to purchase. They may also need to provide an updated disclosure if the purchase price is amended during negotiations.

If you exercise your rescission right, you must pay a rescission fee of 0.25% of the purchase price agreed to by the buyer and the seller. If you paid a deposit before cancelling the contract, the rescission fee will be paid to the seller from the deposit and the balance, if any, will be paid to you.

There are exemptions to the rescission right, including residential real property on leased land, leasehold interests, properties sold at auction or under court supervision, and properties purchased under the Real Estate Development Marketing Act.

Your real estate agent will provide you with the necessary disclosure, which requires your initials or signature, and will explain any parts that are unclear.

Go here for an Explantion video from the BC Real Estate Association

REMOVAL OF SUBJECT APPOINTMENT OF CONVEYANCER

The Removal of "Subject to Clause" and Appointment of Conveyancer is a standard form used in British Columbia when buying or selling any interest in real estate. This form is used to remove the "subject to clause" that may have been included in the initial contract, which outlines specific conditions that must be met before the sale can be completed.

Once these conditions have been met, the "subject to clause" can be removed. Additionally, this form is used to appoint a conveyancer, who is a legal professional responsible for facilitating the transfer of ownership of the property.

The conveyancer will ensure that all legal documents are prepared and executed correctly, and that the transfer of ownership is completed smoothly. It is important to work with a qualified conveyancer who is experienced in real estate transactions in order to ensure that all aspects of the sale or purchase are handled properly.

FINTRAC-RECEIPT OF FUNDS

The FINTRAC-Receipt of Funds form is a document used by real estate professionals to comply with federal anti-money laundering regulations.

It requires the buyer and seller to provide information about the source of the funds used in the transaction, including any bank or wire transfer information, to ensure that the transaction is not connected to illegal activities.

It is an important form that helps prevent money laundering in real estate transactions.

For copies of the Buyer Documents (blank templates)

Please >>>Go here

Feel free to reach out if you have any questions, we are always happy to help.

Best Regards,

Solutions Real Estate Group

Keller Williams Elite Realty