Part 2: Legal Advice Buyers and Homeowners Should Know About
Here is Mark Faris, CEO & Broker and Andrew Ain, Real Estate Lawyer, giving you insight into some of the legal issues surfacing for buyers and home-owners during COVID-19.
Q: If a buyer has put in an offer on a home, and their financing was approved, but they subsequently lose their job, can the lender withdraw financing?
A: Most commitments that lenders give to buyers when they’re waiving financing are conditional on certain things. It is very rare it would be a firm commitment. So, if there was an intervening factor, like losing their job for instance, in most cases the lenders could withdraw that financing. Technically, you’re approved conditionally.
Q: Legally a buyer is entitled to a final walkthrough of a property before taking possession. Can a seller deny a walk-through if they’re concerned about social distancing?
A: The sellers should not be denying walk-throughs since it is a term they have agreed to in the contract. However, if they did deny it because of the exposure concern, I think it would be very difficult to fight that issue right now. Right now, the courts are closed and only opening for urgent cases. I doubt a judge would consider a matter like this urgent. These are difficult times so hopefully this doesn’t happen.
Q: What virtual processes are available from law offices to accommodate clients at this time?
A: It’s been a pretty dramatic change. We’re working now through an application called Zoom. We no longer have any clients attending our office, whereas before, all of our signing would be in person. For sales, it’s wonderful. Things can be signed electronically. Unfortunately, banks haven’t given us the opportunity to accept electronic signatures on mortgage documents. We are working with clients to figure out other ways of getting this done while practising safety precautions, like having them print and sign from home, then scan back. It’s a change, but it still works and we’re still closing deals.