Buying a home and getting your first mortgage is an extremely exciting milestone. That said, it can also be very stressful if you don’t know what to expect or what you have to do going in. One question that often comes up, is about legal witnesses. Specifically, does a witness need to be present when signing a mortgage?
The short answer is yes. At least in Canada, that is.
Witnessing Mortgages in Canada
If you’re getting a mortgage anywhere in Canada, the law mandates that a lawyer who practices in the province or territory where your mortgage is being executed must be present when you sign the papers. If a lawyer isn’t present, then there are a couple other options.
1. Firstly, an officer, employee, or someone designated to act on behalf of the mortgagee can also witness (as long as it is at a financial institution).
2. If none of the parties above are available to witness the mortgage, the Land Titles Office has the authority to allow someone else entitled to administer oaths pursuant to the Mortgage Act, to act as a witness. Their name, position, address, and position at a financial institution, if applicable, must be provided.
This may all sound a bit confusing if you’ve never signed a mortgage before, but in reality, the witness rule is to make it easier for you and to protect your rights, so don’t stress about it.
Witnessing Mortgages Outside of Canada
According to Thomas Dorfman Sweatman LLP,
“There are international treaties in place respecting the execution of documents outside of Canada, a Transfer of Land, a Transfer of Encumbrance, and a Mortgage may be witnessed by a lawyer, a notary public for the jurisdiction where the Transfer is signed, or a person entitled to administer oaths outside of Manitoba, without the necessity of an affidavit of execution.
The Mortgage may also be witnessed by an officer, an employee, or a person designated to act on behalf of a mortgagee which is a financial institution, and an affidavit of execution is not required.”
Witnessing Real Estate Deals
First time home buyers should be aware that the rules of mortgage signing don’t always apply to the real estate deal between the buyer and seller.
Most home resale agreements include a spot for the buyer, the seller, and a witness to sign, although it’s not actually mandated legally that a witness is present.
The only reason for a witness to sign is to prevent either the buyer or the seller from denying that they signed it to get out of the deal. If the witness sees both parties sign, he is authorized to give evidence of what he saw and the contract will still be enforceable.
Although technically speaking two spouses can be a witness for the other during a resale agreement, it’s advisable to have a third party present (over the age of eighteen).
All things considered, even when the law doesn’t require it, having a witness present for the signing of any legal documents never hurts. You can even think of consulting a mortgage broker if it happens to be your first time.
I am Eric Jones, a businessman by profession. Business and entrepreneurship are my passion and I love researching on the various aspects of those areas. I make sure that I don’t miss out any updates and for this reason I read quite a lot. Law is yet another area which I am passionate to know more about.