The Mortgage Legal Process

Once you have obtained financing from your mortgage professional the documents are sent to the realtor to remove the conditions, or are put on hold if you are simply refinancing. The next step is to submit everything to the lawyer, which is done by your mortgage professional. Here is an inside look at the legal process from our point of view:

1. The lender verifies that all conditions have been met and let’s your mortgage professional know.

2. Over the next two days, legal documents are prepared by the legal department of your mortgage provider for the lawyer.

3. All documents are sent to the lawyer where a paralegal (most likely) will prepare the paperwork to be signed when you meet with the lawyer.

4. Once all the paperwork is ready, the lawyer will call to set up a time to meet with you.

5. Meet with the lawyer, supply any other documentation they have requested, and sign the papers. Take this time to ask any questions you may have.

6. The lawyer and paralegal send all papers to the lender. The lender will then take about two days before your financing is in place.

7. On the pre-set day, the lender notifies the lawyer that everything has cleared and the funds are released to you to make a purchase or refinance.

This shows a perfect scenario. The legal process is complicated and things generally take much longer to complete. A small sampling of things that can go wrong are:

• Communication – Sometimes a fax or email is messed up and causes a delay in getting the paperwork prepared. Other delays can be caused if the lender is slow to provide a payout statement.
• Personalized Cheque – Your lender will require a void cheque or PAD form from your bank. If this document is messed up or forgotten it will cause a considerable delay.
• Debt Reductions – If you have negotiated a debt payout as a condition of your mortgage financing be sure that all correct account numbers are sent to your lawyer. These are important as the lawyer needs to be able to obtain a current balance easily.
• Valid Identification – The lawyer will need to verify your identity as per mortgage requirements. If they are unable to do this because you forgot your ID or it’s expired the process will be delayed again.

Many things could cause a delay including issues on the seller’s side, such as a delay in funding or a complication in the wire transfer. No process is flawless, but your legal team will be there for you every step of the way.

If you opt to use a legal service to complete a refinance of your mortgage then you need to be thoroughly versed in everything mentioned above. Also be aware that the person you meet with to sign papers is most likely not a mortgage professional, they are simply there to witness the signing of the papers. If there is any term you do not understand don’t sign the papers until you talk to your mortgage professional!

We deal with this legal process every day and are always available to answer any questions you may have along the way. We also have great connections to trustworthy lawyers in the Calgary area who can help you obtain the home of your dreams.