A lawyer was saved from financial and reputational damage due to Chicago Title’s Transaction Protection Endorsement (TPE).
An insured property owner who was not a citizen or permanent resident purchased a property in St. Catherines/Greater Golden Horseshoe Region, Ontario. Due to his status as a foreign investor, his transaction was subject to an additional tax called a Non-Resident Speculation Tax (NRST), which is supposed to be paid at closing when the transfer gets registered. A Non‑Resident Speculation Tax (NRST), also called foreign buyers tax, “is a 15% tax on the purchase or acquisition of an interest in residential property located in the Greater Golden Horseshoe Region, Ontario, by individuals who are not citizens or permanent residents of Canada or by foreign corporations (foreign entities) and taxable trustees.”
However, the insured’s lawyer made a mistake and did not realize the property was within the area where NRST would apply. The insured got hit with a surprise bill a few months later, including several thousand additional interest and fees. The insured paid the principal soon as they learned of this error but submitted a claim to Chicago Title for the interest and costs.
Chicago Title accepted the claim under the Transaction Protection Endorsement (TPE) that protects the insured against actual loss sustained by the insured due to inadvertent transaction errors made by the lawyer or notary. While the insured remained responsible for the principle of the tax, Chicago title covered the interest and fees.
Transaction Protection Endorsement exists to protect the insured against the unpredictable. As a Notary or Lawyer, you are protected from financial and reputational damage when issues that may take you to court arise while acting on behalf of the purchaser and vendor in a real estate transaction.
Click on the link to learn more about Transaction Protection Endorsement: https://bit.ly/3qppHxp