Last minute items to attend to while getting that income or rental property mortgage and closing your deal.
by Doug Cumpson - Partner - Tax Specialist @ GB Taxes & Accounting
(Waterdown, Ontario between Toronto and Hamilton)
Working with taxpayers and Business Owners since 1983
While it may seem obvious but there can be a surprise at the last minute just before registering your income property mortgage and closing of your real estate deal - even if you have already checked the property tax liability previously. Sometimes there are things going on in the background that you are not privileged to.
Therefore smart people purchase Title Insurance with their income property mortgage - Title Insurance will protect you against unpaid water bills, electrical bills, last minute property liens, natural gas bills, unpaid contractor bills, and any other unknown activity that did not surface when the lawyer representing you on the closing of the deal was not able to discover.
Be sure to contact an accounting expert early if you are buying an income property - you want to know if the property will sustain itself - also the law with regards to the landlord tenant act and commercial law issues that you may need to clarify with your lawyer before you close the deal.
A tax specialist will provide you with hard questions that you want to ask the seller about before you buy. Every property has tax issues associated with it and you need to know what they are before you buy - especially if the property will be business related - as the HST itself can be an issue.
In closing, a tax advisor is one of the partners you should consult with when buying an investment property - the net result is ease in your income property mortgage funding and successful closing.