Editor's Note: This post was first published on July 2, 2016.
Will home buyers willingly pay an extra $148 to help lawyers close their purchase transactions?
The question arises in the wake of the launch by First Canadian Title Company Ltd. (FCT) of EasyFund, a web-based money transfer system. Its stated goal is to streamline the workflow of real estate closings.
The system operates by co-ordinating the electronic movement of funds between lawyers and banks during real estate transactions.
I first wrote about this program in May after news of the venture was announced at a conference of real estate lawyers. The name of the sponsor was not available at the time.
Currently, real estate lawyers courier certified cheques to each other, or deposit funds directly into each other’s trust accounts. EasyFund instead will receive money from buyers’ lawyers and securely hold it until the transactions close and the funds can be released.
The system requires both lawyers to be registered with the program. The cost of participating in EasyFund for each transaction is $67.80, including HST. This amount is paid by the buyers or shared between buyers and sellers.
In addition, when the buyer’s lawyer receives funds from the client and the new mortgage lender, that money must be wired from his or her trust account to EasyFund at an additional bank charge of $80, bringing the total additional cost to $147.80.
When I wrote about this venture in May, I called it a solution in search of a problem.