Published 2 November 2026 · By Jatin Dua, Broker of Record, RE/MAX Quantum Realty
Ontario sellers are usually paid on closing day or within a few business days. The buyer’s lawyer sends funds to your lawyer’s trust account on closing; your lawyer pays your mortgage, any commission not covered by the deposit, and fees, then sends you the rest. Delays usually come from late buyer funds, items on title or a non-resident holdback.
This guide is for Ontario homeowners who have sold, or are about to sell, and want to know exactly when the sale money lands in their bank account and why it sometimes takes longer. You will get the closing-day money trail step by step, what gets paid before you see a dollar, the common causes of delay, and a worked example.
When do you get the money from a house sale in Ontario?
Your money arrives through your real estate lawyer, not the buyer or your agent. On closing day the buyer’s lawyer sends the balance of the price to your lawyer’s trust account. Your lawyer then pays off your mortgage and the other charges you owe and sends you what is left.
There is no Ontario rule that sets a deadline for that last step. In my experience most sellers receive their net proceeds on closing day or within a few business days, once the funds are confirmed and the mortgage payout has gone through. Your lawyer can tell you their own practice, and you should ask before you sign.
| When | What happens | Money to you? |
|---|---|---|
| Weeks before closing | Your lawyer requests a mortgage payout statement; lenders typically take two to five business days, and the figure is valid only for the closing date it was issued for | No |
| A few days before | You sign the transfer, statement of adjustments and payment directions with your lawyer | No |
| Closing day | Buyer’s lawyer sends funds; title transfers electronically; your lawyer wires your mortgage payout | Usually the same day or soon after |
| After closing | Your lender processes the discharge; any balance of the deposit is settled with the brokerage | Possibly a smaller balance |
Source: Ontario real estate law firm explainer on lender payoff (timing of payout statements); my practice notes for the other steps.
How does the money move on closing day?
Most of closing day happens between the two lawyers. The buyer’s lawyer receives the mortgage advance from the buyer’s lender plus the buyer’s own funds, then sends the balance due to your lawyer. The transfer of title is registered electronically through Ontario’s land registration system, often referred to by its software name, Teraview.
Large payments between lawyers often move by wire. In Canada, high-value wires settle through Lynx, the system Payments Canada launched on August 30, 2021 to replace the older Large Value Transfer System. The Bank of Canada describes Lynx as settling payments in real time, and once a payment settles it is final and irrevocable. That certainty is one reason lawyers can release funds quickly once a wire arrives.
For a plain-English walk-through of the whole day, including keys and the final visit, see my guide to what happens on closing day in Ontario.
What gets paid before the seller gets the money?
Your lawyer pays these out of the sale funds, in roughly this order, before sending you the balance:
- Your mortgage and any secured line of credit. The payout includes the principal, interest to the closing date, any prepayment charge and the lender’s discharge fee. Interest runs daily, which is why the payout statement is tied to one date.
- Brokerage commission and HST, to the extent the deposit held by the brokerage does not already cover it.
- Your lawyer’s fees and disbursements.
- Anything else registered against the property, such as a lien, which must be cleared for the buyer to get clean title.
The statement of adjustments adds or subtracts smaller items, such as property tax you prepaid. My guide to seller closing costs in Ontario for 2027 lists every fee in detail, and the post on mortgage discharge fees covers that one line.
What happens to the buyer’s deposit when the sale closes?
On a resale, the buyer’s deposit usually sits in the listing brokerage’s trust account until closing. Section 27 of the Trust in Real Estate Services Act, 2002 says a brokerage must keep trust money separate from its own and pay it out only in accordance with the terms of the trust. Section 27(3) adds that, unless a contract says otherwise, interest earned on trust money belongs to the person who beneficially owns the money.
Many listing agreements allow the brokerage to apply the deposit toward its commission once the deal closes. If the deposit is larger than the commission, the difference comes back to you; if it is smaller, your lawyer pays the rest from the sale funds. Read your own listing agreement and ask your brokerage when it releases any balance, so you are not surprised by a second, smaller payment a few days after closing.
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How much will I actually receive? A worked example
Here is an illustration using the October 2026 median detached sale price across the TRREB area, $1,110,000. Every other number is an assumption. Replace them with your own figures from your lawyer, lender and listing agreement.
| Line | Amount | Where it comes from |
|---|---|---|
| Sale price | $1,110,000 | TRREB median detached price, October 2026 |
| Deposit already held by brokerage (example) | $50,000 | Your agreement of purchase and sale |
| Balance sent by buyer’s lawyer, before adjustments | $1,060,000 | Price minus deposit |
| Property tax adjustment in your favour (example) | +$1,200 | Statement of adjustments |
| Mortgage payout, interest and discharge fee (example) | -$500,000 | Lender payout statement |
| Commission and HST above the deposit (example) | -$2,000 | Your listing agreement |
| Legal fees and disbursements (example) | -$1,800 | Your lawyer’s quote |
| Net to you from your lawyer | $557,400 | My arithmetic |
Source: TRREB Market Watch, October 2026, for the median price; all other lines are illustrative assumptions, not quotes or typical rates.
In this example the $50,000 deposit covered most of a $52,000 commission bill, so only $2,000 came out of the closing funds. If your deposit is larger than your commission, you would receive a separate refund of the difference from the brokerage instead.
Why might my sale proceeds be delayed?
Most closings run on time. When money is late, it is usually one of these:
- The buyer’s funds arrive late. If the buyer’s lender is slow or the buyer is short, registration and payment wait. A short delay may lead to an extension; see extending a closing date in Ontario.
- The payout figure is out of date. If the closing date moves, a new payout statement may be needed, because the old one covered a different date.
- Something unexpected is on title. A lien, an old mortgage that was never discharged or a registered notice has to be dealt with before your lawyer can release everything.
- You are a non-resident of Canada. Tax rules allow the buyer to hold back part of the price (see below).
- Paperwork gaps. Estate sales, powers of attorney or a missing signature from a co-owner can hold up the release of funds.
After closing, your lawyer will have given the buyer’s lawyer a promise, called an undertaking, to get your mortgage discharged. The Canadian Bar Association’s mortgage toolkit notes that the buyer’s lawyer requires this undertaking whenever a mortgage is still registered at closing, and that delays by lenders can leave the seller’s lawyer with an undertaking not yet fulfilled. That is your lawyer’s job to chase, and it does not usually hold up your money.
Do non-residents get paid later when selling in Ontario?
Often, yes. Under section 116 of the Income Tax Act, a non-resident seller must notify the Canada Revenue Agency within 10 days of the sale, and the CRA issues a certificate once tax on the gain is paid or secured. If no certificate is issued, the CRA says the buyer is entitled to withhold 25% (50% on certain types of property). In practice that money is held back at closing until the certificate arrives. My guide to section 116 for non-resident sellers explains the calculation.
Do not commit your sale money to a new purchase that closes the same day unless your lawyer has confirmed the timing works. If your sale closes late in the afternoon, your purchase funds may not be ready when your own seller’s lawyer expects them. Ask your lawyer to plan both closings together, or leave a gap of at least a day.
Do I pay tax on the money from selling my house?
If the home was your principal residence for every year you owned it, the gain is usually exempt, but you still have to report the sale. The CRA requires you to report the sale of a principal residence on Schedule 3 of your tax return and complete Form T2091(IND), a rule in place since the 2016 tax year. The CRA warns that a penalty may apply to a late designation. Nothing is withheld for this at closing for a Canadian resident seller, so keep your closing documents for tax time.
The single most useful thing a seller can do is ask their lawyer, a week before closing, two questions: “How will you send me the money?” and “On what day do you expect to send it?” Then give them your banking details in writing early. Most delays I see are not legal problems at all; they are a payout statement requested too late or a seller who was travelling and could not sign. If you are buying at the same time, my guide to picking a closing date shows how to space the two deals.
What to do next
- Ask your lawyer how and when they release net proceeds, and give them your banking details in writing.
- Make sure your lawyer has your mortgage and any secured line of credit details early so payout statements are ordered on time.
- Check your listing agreement for how the deposit is applied to commission and when any balance is refunded.
- If you are a non-resident, start the section 116 process with a tax adviser well before closing.
- Keep your statement of adjustments and lawyer’s reporting letter for your tax return.
Need help with this? Talk to me.
I’m Jatin Dua, Broker of Record at RE/MAX Quantum Realty, and I’m the best agent to do this kind of work for you in Toronto and across the GTA. Over $100 million in GTA sales and 100+ families helped sell. Feel free to contact me any time: call or text 833-330-1925 or email [email protected].
Frequently asked questions
When do I get the money from my house sale in Ontario?
Usually on closing day or within a few business days after it. In Ontario the buyer’s lawyer sends the funds to your lawyer’s trust account on closing day; your lawyer pays off your mortgage, commission balance and fees, then sends you the rest. No Ontario rule sets the exact timing, so ask your lawyer about their release practice before closing.
Who pays the seller after closing in Ontario?
Your own real estate lawyer pays you. In Ontario the buyer’s lawyer sends the closing funds to your lawyer’s trust account, not to you directly. Your lawyer pays your mortgage and other charges and sends you the net amount. If the brokerage holds a deposit larger than your commission, it may refund the balance to you separately.
How long after closing does the seller get the money in Ontario?
In my experience, most Ontario sellers are paid the same day or within a few business days. High-value wires between lawyers settle through Lynx, which the Bank of Canada describes as real time, final and irrevocable. Delays usually come from late buyer funds, an outdated mortgage payout statement, unexpected items on title, or a non-resident holdback under section 116.
Does the seller get the deposit in Ontario?
Yes, as part of the price on closing. On an Ontario resale the deposit normally sits in the listing brokerage’s trust account until the deal closes, and under section 27 of the Trust in Real Estate Services Act, 2002 it can only be paid out according to the terms of the trust. Many listing agreements apply it to commission, with any balance refunded to the seller.
Why is my lawyer holding my sale proceeds after closing?
Usually because something must be paid or confirmed first. Common reasons in Ontario include waiting for the buyer’s funds to arrive, paying out a mortgage or line of credit, clearing a lien or old registration on title, or a section 116 holdback for a non-resident seller. Ask your lawyer which item is outstanding and when they expect to release the funds.
How much do non-residents have held back when selling in Ontario?
The CRA says that if no certificate of compliance is issued, the buyer is entitled to withhold 25% of the price (50% on certain types of property). A non-resident seller must notify the CRA within 10 days of the sale. Many Ontario closings hold the amount in trust until the certificate is issued, so the seller receives that part later.
Is the money from selling my home taxable in Canada?
Usually not, if the home was your principal residence for every year you owned it. You must still report the sale on Schedule 3 of your tax return and complete Form T2091(IND), which the CRA has required since the 2016 tax year. A penalty may apply to a late designation. Investment properties and non-resident sales are taxed differently.
Is the mortgage paid off before the seller gets the money in Ontario?
Yes. Your Ontario lawyer uses the sale funds to pay your lender the amount on the payout statement, which includes principal, interest to closing, any prepayment charge and the discharge fee, before sending you the balance. The lender then discharges the mortgage from title, and your lawyer follows up on that after closing.
Can I use my sale money to close a purchase the same day in Ontario?
It is possible, but risky. Your sale funds have to arrive and clear your lawyer’s trust account before they can be sent on to your own seller, and closings can run late into the afternoon. I usually suggest a gap of at least a day between a sale and a purchase, or bridge financing if both must close together, and your lawyer should confirm the plan.
Sources
- Bank of Canada: Overview of Lynx, Canada’s High-Value Payment System
- Canadian Bar Association: Discharge and release of mortgages
- RealEstateLawyers.ca: Close on time, Ontario lender payoff explained
- Trust in Real Estate Services Act, 2002, section 27
- CRA: Disposing of or acquiring certain Canadian property (section 116)
- CRA: Principal residence and other real estate
- TRREB Market Watch, October 2026
Related reading
- Seller Closing Costs in Ontario for 2027: Every Fee Before You Get Paid
- How to Sell a House in Toronto, Step by Step (2027)
- Closing Costs on a New Build in Ontario: What Builders Add
- How Much Is My House Worth in Caledon? (2027)
About the author — Jatin Dua, Toronto and GTA real estate broker
I am Jatin Dua, Broker of Record and co-founder of RE/MAX Quantum Realty Inc., Brokerage, Unit 101, 799 The Queensway, Toronto. I work with buyers and sellers across Toronto and the GTA and have helped more than 100 families sell. Four-plus years of active GTA transactions and over $100 million in sales volume.
Reach me at [email protected] or 833-330-1925, or book a call.