A seller is so happy to receive a decent offer on a home for sale, accept it, sign the purchase agreement, and then enter into the escrow period. That is when the nerve-wracking waiting begins until the escrow closing is scheduled and the sale is finalized. The wait can be excruciating.

The close is not always on a certain date because so many factors are involved. Sometimes, there are delays in the paperwork or processing delays at the title company, which slows the process.

The home escrow process in Toronto can take 30 days or less if everything goes very smoothly. Nevertheless, allow up to eight weeks if there are challenges along the way.

Here are four ways to stay calm:

1. Understand the process and help complete each step.

2. Practice daily meditation.

3. Take anti-anxiety medication prescribed by a doctor.

4. Enjoy a stiff drink.

The most helpful of these four ways is to know what actually has to happen for the sale to close.

The Home Escrow Process in Toronto

1. Open the Escrow Account — After the purchase agreement has been accepted by the parties, an escrow account is opened with the earnest money deposit from the buyer that is specified in the purchase agreement.

2. Bank Appraisal — The bank providing the mortgage financing will conduct an appraisal that normally the buyer pays for. This is to make sure the purchase price matches or exceeds the appraised value. This is a critical part of the process. If the appraisal is lower than the purchase price, either the buyer will have to come up with the difference or the seller will have to come down in price or a compromise must be made between the two. If this is not possible, then the appraisal may be challenged by giving more information, getting another appraisal, or a new lender may be sought to see if their appraisal may be more favorable.

3. Financing is Secured — The buyer should have been pre-approved before the purchase agreement is accepted, so this is just the formal process of getting the money from the bank.

The bank gives a detailed loan commitment in writing stating the terms of the loan that the buyer must accept in writing.

4. Seller’s Disclosures Approved by Buyer — If the Seller made any disclosures to the buyer, such as part of the construction does not meet building codes, these must be accepted in writing by the buyer

5. Inspections — Any inspections of the property are conducted, repairs if any are made, and the buyer accepts the inspection process is completed. Who pays for the repairs is determined by the terms of the purchase agreement.

6. Insurance — Home insurance is obtained. Flood insurance is obtained if required by the mortgage lender. Title insurance is obtained for the title report that shows the property is free and clear of any liens or other encumbrances.

7. Final Walk-Through — The Buyer inspects the property personally for the last time to make sure no damage has occurred that happened at the last moment.

8. Escrow is Closed — The buyer signs the closing documents. The seller gets the proceeds from the sale less the real estate commissions paid to the agent. The buyer gets the keys. Everyone celebrates.


It is not easy to stay patient throughout this process; however, being impatient does not make the home escrow process in Toronto go any faster. Usually, after the financing is secured and committed by the bank, the rest of the process goes forward without much delay unless the inspections uncover something seriously wrong.


Understanding the Escrow Process

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