Winnipeg Land Titles: Not fast, but it IS secure

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I get letters and e-mails from people, asking about real estate issues.  Here is one I received in the past.  The names and dates have been changed to protect the innocent 🙂

“I am writing this letter in regards to the sale of my mother’s house, which the new owners have moved in  (2 weeks ago). There has been no money from the sale given to my parents (and the lawyers say it is in the hands of land titles )? What is this all about and how long does this process usually take. During this time, they are paying two mortgages and can not afford this at all, and have borrowed money to cover this. Family members that we have spoken to have never heard of this process and we are getting really worried for my parents.  Can you please explain the whole process of after the sale to ease my parents worries?  The reason we did not bother with asking our real estate agent or lawyer is because my parents aren’t very comfortable with either.”

Land Titles

First, the good news :  What has been described in the letter above appears to be running the normal process, so there does not seem to be any need to panic.  (Keep in mind that I am NOT directly involved in this particular incident, and only have the above letter to guide me.)  Real Estate sales in Manitoba use the Torrens System of Land Titles, and have done so since 1885.  While it seems to be a slow, methodical and time consuming process, the upside is that it is Safe and Secure.  This system operates under 3 principles:

1) The Mirror Principle:

Our Land Titles Register ‘accurately reflects’ (like a mirror, get it?), the current facts surrounding the title.  It is considered to be conclusive evidence as to the current owner of any given property

2) The Registration Required Principle:

If this title is supposed to be conclusive, then ALL transfers and changes which effect title MUST be registered with the Land Titles Office.  Among other things, this includes any Mortgages.

3) The Assurance Principle

Ever heard of stories where the same property was sold TWICE?  I just read about a couple who bought a condo in the U.S., and about a week after moving in, they received an eviction notice, because the 2nd buyer wanted to take possession.  Upon closer examination, it was learned that the same home was sold to BOTH buyers.  Our Land Titles system is set up to prevent this from happening.  But beyond that, if it ever DID happen, the Province of Manitoba would compensate any aggrieved party thru the  Land Titles Assurance Fund.

How long does it take?

On average, it takes approx. 3 to 4 weeks for Land Titles to ‘clear’, and the money to be transferred to the seller’s lawyer.  According to the Offer to Purchase, Sect 2 (b), any money being paid to the home Seller, which is delayed as a result of Land Titles transfers, “..shall bear interest payable to the Seller at the same rate as the new mortgage…”

In other words, the home seller should be receiving 3 or 4 weeks worth of interest on their sale.

I hope this answers the question as to the time delay which is being experienced via Land Titles registration.  If you have any real estate related questions, please do not hesitate to call me or email me.  I guarantee that you will be ‘comfortable in dealing with me!”  🙂

UPDATE: The lady who wrote the above letter advised me that her parents did indeed receive the money (after about 3 weeks)  and all is well…..  yeah!

F.A.Q. About Land Titles Transfer Tax

What is Land Titles Transfer Tax in Winnipeg?

This is a one-time tax paid each time a property is ‘transferred’ between owners. It is calculated based on the value of the property. Most provinces in Canada do have a Land Titles Transfer Tax, but each jurisdiction has their own way of calculating the tax.

Who pays the Land Titles Transfer Tax?  The Buyer or the Seller?

In Winnipeg, the LTTT (Land Titles Tax) is paid by the buyer. It is paid EACH time you buy a property, house, condo or vacant land. If you sell the property at a later time, there is NO refund or credit. It is quite literally a tax grab by the provincial and civic governments.

Do I have to pay the Land Titles Transfer Tax on a Condo?

Yes, any type of residential property, including houses, condos and vacant land are subject to this tax.

How do I calculate the Land Titles Transfer Tax in Manitoba?

We have a tool that will help you embedded in our App. Its available here… Land Titles Tool.

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