COVID-19 complicates Quebec real estate deal

Border restrictions, quarantine and Quebec law requiring parties to sign in person called for a creative solution that HSBC Bank Canada was more than happy to provide

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At Home is a five-part series that asks Canadians to share what home ownership means to them from the perspective of the head and the heart.

When Mike and Mary started looking for a home at the start of this year, it wasn’t a choice.

They were living with Mary’s parents in Toronto with a new baby while Mary, 28, finished medical school. Mike, 31, was on paternity leave but will return to his federal government job in Ottawa this fall.

“We needed a place to move into as of August when my leave expires,” says Mike, who requested that we not use his last name for reasons related to his job. “We looked around in a bunch of different communities, found a budget that worked for us, and eventually decided upon a rural community near Ottawa.”

After shopping for mortgages for months, the couple chose a five-year, fixed-rate mortgage with HSBC Bank Canada earlier this year. They found a house in the Gatineau region, just across the Quebec boundary from Ottawa.

“The house we found was beautiful. By chance, the people had only had it up for sale as a tester to see if there was any interest,” Mike says.

The sellers wanted to move in June, which worked for Mike and Mary. They had a deal.

“Then COVID happened,” Mike says.

Quebec, alongside some other provinces and territories at the time, closed its borders to travellers unless they met very strict criteria.

The transactions up to the point of closing were all digital. The purchase and sale agreements, bank documents and even signing the down payment were completed using secure online tools.

“I thought everything was going to be fine and then the week we were supposed to close, I was told that my wife also had to travel to Quebec,” he says.

Quebec has a law that requires home sales to be signed in person, on Quebec soil.

As the home purchase drama unfolded for Mike, his family was facing other problems in Toronto. Mary’s mother lost her job owing to COVID-19 and her father ended up being exposed to the virus through work.

“My wife and my mother-in-law and my father-in-law were quarantined and they weren’t allowed to leave for 14 days. I was able to still move around because I wasn’t living with them at that time,” he says.

Mary couldn’t go to Quebec, though.

That’s when Mike says his HSBC Mortgage Specialist really stepped up. She advised them that they could take a very unusual move for a mortgage process and obtain a power-of-attorney authorization to allow Mike to sign on Mary’s behalf.

“It worked. I got the keys and we have the house,” he says.

We looked around in a bunch of different communities, found a budget that worked for us, and eventually decided upon a rural community near Ottawa.

MIKE

“It’s a good illustration of the challenges that institutions and clients had during this period,” says Matt Mercer, Head of the Mortgage Centre at HSBC Bank Canada in Toronto.

The real estate and banking industries have been quick to adapt, Mercer says, and while March through May saw drastic declines in real estate and mortgage activity, business was booming in June.

“I’m very impressed by the flexibility across all the different parts of the industry — appraisers, lawyers, real estate agents, and banks — to be able to adjust to this crisis to make sure people are looked after,” Mercer says.

While some homeowners may fear they can’t buy or sell a property or renew their mortgage as usual, most of the process can be completed remotely, he says.

“If you need to make a move, or renewal, don’t settle for second best because you’re nervous,” he says. “Talk to somebody. See if we can quell your concerns and make sure that you get the best deal possible.”

Mortgage rates are also extremely low right now, he adds.

“It is an opportunity. It’s a lower payment and a lot of interest cost savings. Everybody works hard for their money, so you want to keep as much as you can in your own pocket,” Mercer says.

Mike and Mary were able to lock in a lower five-year, variable-rate mortgage with HSBC compared to the preapproved fixed rate they negotiated prior to the COVID-19 outbreak.

“That’s a nice silver lining,” Mike says.

It was a stressful few months for the couple, but things have improved. Mary’s father didn’t get sick and the real estate deal went through.

The sale closed on May 1, he took possession on June 1, and mom, dad and baby moved in over the summer.

“I’m happy to say it’s mostly ironed out now and I’m unpacking boxes,” Mike says. “The house is in great shape. And it came with a bunch of toys I like, including a nice John Deere lawnmower.”

He’ll need it for the two-acre property.

“We love this spot. It’s beautiful. We want to see what kind of lakes we can access and what kind of adventures we can have with the little one.”

“Every HSBC Mortgage Specialist has those clients, those mortgage cases you look back upon and smile,” adds Mercer. “And this is definitely one of them.”

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A proud sponsor of At Home, HSBC Bank Canada understands that the way you finance your home affects your lifestyle and wealth building potential. In times of uncertainty, our mortgage specialists can help you integrate your mortgages into life’s bigger picture, so that you can enjoy the freedom and flexibility you need to realize all of your dreams. Learn more at HSBC Bank Canada.

Advertising feature produced by Globe Content Studio. The Globe’s editorial department was not involved.