Know the proper protocols.
We recently got asked a great question about something outside of our normal mortgage vocabulary and so wanted to share the answer with you.
How long should you keep all those documents from the purchase of your home? What’s the protocol on keeping documents like appraisals, sale agreements, and the like?
First, you have to know a bit about how the Canada Revenue Agency defines records. They say that records include any supporting documentation to the information contained in your filed taxes. So this may mean documents related to the sale or purchase of a home.
If you own a rental property it is especially important that you can back up any information you supply them, and your accountant or Revenue Canada should be consulted to make sure you have everything you need, and a great filing system set up for the future.
In general, Revenue Canada recommends keeping records for six years plus the current year, and they have a great guide book that goes into extensive detail about electronic record keeping as well.
Here are some additional tips on record keeping you might want to consider that are over and above Revenue Canada’s recommendations. We also think there is great value in creating a folder for any records related to your home’s value and storing it all in one place.
- When you invest in a Real Property Report, which can be up to a $1500 value, you’ll want to keep that, especially if you plan to sell your property.
- All the documents related to the Mortgage itself should be kept, and we’ll make sure you have copies of everything in paper or electronic, or both if you prefer!
- You want to keep Statements of Disbursements so you know what the lawyer did and how much you paid for it.
- And if an appraisal was done, it’s good to have as it because it shows the value at the time of purchase, and can be used as a comparative when selling or refinancing.
Once you sell the property and everything is finalized, you can safely dispose of these documents.
Have questions? Feel free to give us a shout and we’ll make sure you get the right answer.