How the Agreement of Purchase and Sale works, what each clause means, how deposits are held and what happens when a deal goes wrong — for buyers and sellers in Ontario.
The agreement
What is an Agreement of Purchase and Sale in Ontario?
It is the contract for buying a home, usually on the standard OREA form, setting the price, deposit, closing date, what is included, conditions and all other terms. Once signed by both parties and acceptance is communicated, it is legally binding.
Full guide: How to buy a house, step by step
Last reviewed October 2026 · Jatin Dua, Broker of Record
What is the irrevocable date on an offer?
It is the deadline by which the seller must accept the offer; until then the buyer cannot withdraw it. If the seller has not accepted by that time, the offer is null and void.
Full guide: Conditions and terms in an offer
Last reviewed October 2026 · Jatin Dua, Broker of Record
What is a sign-back?
A sign-back is a counter-offer: the seller changes terms such as price or closing date on the buyer’s offer and returns it. The buyer can accept, reject or sign back again; nothing is binding until one side accepts the other’s final version.
Full guide: The offer process
Last reviewed October 2026 · Jatin Dua, Broker of Record
What is the difference between chattels and fixtures?
Fixtures are attached to the home — built-in light fixtures, window-covering hardware and built-in appliances — and stay unless excluded; chattels are movable items such as freestanding appliances, which are included only if the agreement lists them. Spell out anything you care about.
Full guide: What to include in an offer
Last reviewed October 2026 · Jatin Dua, Broker of Record
What are rental items in an Ontario purchase agreement?
Equipment the seller rents rather than owns, commonly a water heater, furnace or water softener; the buyer usually agrees to assume the rental contract. Ask for the contract terms, because some carry buyout costs.
Full guide: Rental water heater and furnace contracts
Last reviewed October 2026 · Jatin Dua, Broker of Record
Are escalation clauses used in Ontario?
Rarely. An escalation clause automatically raises an offer above competing bids up to a cap, but in Ontario sellers and agents generally avoid them because they reveal competing offers and are hard to verify. Most buyers make their single best offer instead.
Full guide: Escalation clauses in Ontario offers
Last reviewed October 2026 · Jatin Dua, Broker of Record
Conditions and deposits
What is a sale-of-buyer’s-property condition?
It makes the purchase conditional on the buyer selling their current home by a set date. Sellers usually accept it only with an escape clause, letting them keep marketing and require the buyer to waive the condition within a short time if another offer comes in.
Full guide: Offer conditions
Last reviewed October 2026 · Jatin Dua, Broker of Record
Who holds the deposit in an Ontario real estate deal?
Usually the listing brokerage, in its real estate trust account, until closing. It is credited to the buyer on closing and cannot be released before then without a written mutual release or a court order.
Full guide: Deposit vs down payment
Last reviewed October 2026 · Jatin Dua, Broker of Record
What happens to my deposit if my conditional offer falls through?
If a condition is not met or waived by its deadline and the deal ends under that clause, the deposit is normally returned in full, after both parties sign a mutual release. Read how each condition is worded — that controls the outcome.
Full guide: How conditional offers end
Last reviewed October 2026 · Jatin Dua, Broker of Record
What is a mutual release?
A signed agreement by buyer and seller that ends the deal and directs what happens to the deposit. The brokerage holding the deposit needs it, or a court order, before releasing the money.
Full guide: Backing out of an accepted offer
Last reviewed October 2026 · Jatin Dua, Broker of Record
Problems and closing
What happens if a buyer can’t close in Ontario?
The buyer is in breach: the seller can usually keep the deposit and sue for further losses, such as a lower resale price and carrying costs. If financing is the problem, talk to your lawyer about a short extension before the closing date.
Full guide: When a buyer cannot close
Last reviewed October 2026 · Jatin Dua, Broker of Record
What happens if the seller backs out after a firm deal?
The seller is in breach. The buyer can claim damages and, because every property is unique, may ask a court to order the seller to complete the sale; the buyer’s lawyer may register a certificate of pending litigation on title to protect the buyer’s interest.
Full guide: When the seller does not perform
Last reviewed October 2026 · Jatin Dua, Broker of Record
Can the closing date be changed?
Only if both parties agree in writing, usually through an amendment drafted by the lawyers. Neither side can extend it unilaterally.
Full guide: Closing day
Last reviewed October 2026 · Jatin Dua, Broker of Record
What is a final walk-through and can I do one?
It is a visit to the home shortly before closing to check its condition and that the included chattels and fixtures are there and working. Set the number and timing of pre-closing visits in your offer so there is no argument later.
Full guide: The final walk-through
Last reviewed October 2026 · Jatin Dua, Broker of Record
What does a real estate lawyer do on a purchase?
Searches title and work orders, reviews the agreement, prepares the mortgage and transfer documents, handles the funds and land transfer tax, registers the deal electronically and arranges title insurance. In Ontario every purchase uses a lawyer.
Full guide: What a real estate lawyer does
Last reviewed October 2026 · Jatin Dua, Broker of Record
What is a vendor take-back mortgage?
A mortgage the seller provides to the buyer for part of the price, registered on title and repaid over an agreed term. It can help close a deal when bank financing falls short, but the seller takes on the lender’s risk.
Full guide: Vendor take-back mortgages
Last reviewed October 2026 · Jatin Dua, Broker of Record
Who pays for a survey in Ontario?
There is no rule: the buyer asks whether the seller has an existing survey, and the agreement can require the seller to provide one. Many buyers rely on title insurance instead of commissioning a new survey.
Full guide: Title insurance and surveys
Last reviewed October 2026 · Jatin Dua, Broker of Record
What is POTL?
A parcel of tied land is a freehold home — often a townhouse — tied to a common elements condominium that owns shared roads, parking or amenities. You own your house and lot but pay a monthly fee for the shared parts, so buyers should get the common elements corporation’s status certificate.
Full guide: Condo townhouses and POTLs
Last reviewed October 2026 · Jatin Dua, Broker of Record
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Jatin Dua · Broker of Record · RE/MAX Quantum Realty · Toronto and the GTA