What Happens If Your House Is Damaged Before Closing?
You’ve sold your home, all conditions have been waived, and moving day is just around the corner. Then something unexpected happens—a basement leak, a storm sends a neighbour’s tree crashing into your window, or your roof starts leaking after heavy rain. What do you do if your house is damaged before closing?
It’s a stressful situation for any seller, but you’re not alone. There are clear steps you can take to protect your sale and move forward with confidence.
Who Is Responsible for Damage Before Closing?
In Ontario, the seller is responsible for the home until the day of closing unless the Agreement of Purchase and Sale specifies otherwise. This means if damage occurs after the deal is firm but before the buyer takes possession, it’s typically your responsibility to address it.
Step 1: Notify Your Realtor Immediately
Your first call should be to your Realtor. They can:
✅ Advise you on your obligations
✅ Communicate with the buyer’s agent professionally
✅ Help maintain trust with the buyers during an unexpected situation
Your Realtor is there to guide you through these moments, ensuring clear communication while protecting your interests.
Step 2: Contact Your Lawyer
Your real estate lawyer should be informed of the damage. They may need to:
✅ Review your Agreement of Purchase and Sale to confirm your obligations
✅ Advise on potential extensions or amendments if repairs will affect closing
✅ Provide guidance on next steps to ensure compliance and protect you legally
Step 3: Call Your Insurance Provider
Keep your home insurance active until after closing. If damage occurs, immediately notify your insurer to start a claim. They will guide you on:
✅ Coverage eligibility
✅ Required documentation
✅ Arrangements for repair
Your insurance policy is there to protect you during this period—using it can help keep the sale on track.
Finding a Solution: Honesty and Cooperation Matter
Transparency and a cooperative approach are critical. Most buyers understand that accidents happen, and working together often leads to the best outcomes for everyone.
Potential solutions may include:
🔹 Completing the repairs before closing
🔹 Agreeing on a holdback at closing, where funds are set aside to cover repairs
🔹 Using insurance proceeds to complete repairs after closing with mutual agreement
Your Realtor and lawyer will help you navigate these discussions to find a solution that protects your interests while ensuring the buyer’s concerns are addressed.
What Happens If Your House Is Damaged Before Closing?
Should You Delay Closing?
In many cases, the sale can proceed as planned while repairs are underway. However, if the damage is significant (e.g., structural issues, major flooding), your lawyer may recommend an extension to complete necessary work before transferring ownership.
Communication and clear documentation are key to avoiding misunderstandings during this period.
What About Minor Issues?
What if a minor issue arises, like a small leak or cosmetic damage? While it may feel minor, it’s still important to disclose it to your Realtor and lawyer. In some cases, these can be addressed quickly with repairs or minor compensation, preserving goodwill and avoiding disputes on closing day.
Don’t Cancel Your Insurance Too Early
It’s crucial to keep your home insurance active until the sale has officially closed and funds have been transferred. Cancelling too early could leave you personally liable for damages, potentially delaying closing or resulting in costly out-of-pocket repairs.
Final Thoughts
Selling your home is an exciting step, and while unexpected issues can add stress, handling them promptly and transparently ensures your sale stays on track. Remember:
✅ Notify your Realtor and lawyer immediately
✅ Contact your insurance provider
✅ Work transparently with the buyers
✅ Keep your insurance active until after closing
At Elevate Real Estate Group, we’re committed to guiding sellers through every step of the process, including the unexpected, so you can move forward with confidence.
Elevate Real Estate Group
Why Choose Elevate Real Estate Group?
At Elevate Real Estate Group, we understand that buying a home is a significant decision. That’s why having the right team by your side is essential. Our experienced realtors—Stewart Blair, Jeremy Odland, Brittany Wurfel, and Caitlyn Ford—bring unmatched expertise and dedication to every client.
Additionally, our in-depth knowledge of the London, Ontario, market allows us to guide you through every step of the process confidently. From the initial consultation to the moment you receive your keys, we’re committed to making your journey smooth and stress-free.
Learn more about Elevate here, Meet the Elevate Real Estate Team
Elevated Excellence in Real Estate
When you ask our clients, you’ll hear time and time again how we stand out in a competitive market. Our unwavering focus on Ethical Behaviour, providing the Best Client Experience Possible, and maintaining a Commitment to Excellence sets us apart.
Unlike others in the industry, we do not chase awards, focus on sales volume, or rush through deals to move on to the next client. Instead, we care about Every Client, Every Deal, Every Time. Whether you’re a first-time buyer or a seasoned investor, you can trust us to deliver the care and respect you deserve.
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