Mortgage Clause Changes
Question:
Is there a disadvantage to leaving in clauses on Schedule “A” of an Agreement of Purchase and Sale that are already covered by the pre-written clauses?
Consider the following:
“The Seller agrees to discharge any mortgages or liens or other encumbrances registered against the property on or before closing at the Seller’s own expense.”
Answer:
You have to see whether there is a conflict.
The first one says all mortgages will be discharged on closing. That’s a great out if you are a Buyer.
The OREA standard form requires the Buyer to accept the Seller’s solicitor’s undertaking to discharge certain institutional mortgages. Banks will often take as long as three months to complete the paperwork.
This “new” clause is not consistent with current legal and conveyancing practice.
Brian Madigan LL.B., Broker