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Summary: Most Ontario sellers receive the bulk of their net proceeds on closing day or the next business day, once title is registered and funds clear the lawyer's trust account. A portion is usually held back until the mortgage discharge registers, which can take 30 to 90 days.
When do you actually get paid?
For most sellers, the bulk of your net proceeds arrive on closing day, typically by mid-to-late afternoon once title has been registered and the funds have cleared through your lawyer's trust account. If registration happens early and your bank processes the incoming wire before its cut-off, the money can land the same afternoon; otherwise it posts the next business day.
Two timing realities are worth planning around. A wire transfer is faster and more reliable than a certified cheque, which a bank may hold for one to five business days depending on the amount. And a Friday closing that misses your bank's cut-off may not post until the following Monday, so if your cash flow depends on same-day access, a mid-week closing gives you more room.
How do the funds reach you on closing day?
You and the buyer never exchange money directly. The funds move lawyer-to-lawyer, and your lawyer settles everything tied to the property before releasing what's left to you. The flow is:
Buyer's lawyer sends the purchase funds. The money goes into your lawyer's trust account once the deal is set to register.
Your lawyer pays out what's owed. This covers your existing mortgage, the real estate commissions, and legal fees and disbursements.
You receive the balance. The remaining net proceeds are wired to your account or issued as a certified cheque, per the direction you sign before closing.
For the full mechanics of how money moves between the parties, see how money is exchanged during a real estate transaction in Ontario.
Why does your lawyer hold back some of the money?
This is the part that surprises sellers: even after the main payout, your lawyer is required to keep a portion in trust for a while. There are two usual reasons.
Mortgage discharge holdback. When your lawyer pays out your mortgage on closing day, the lender gets the money, but the formal discharge that removes the charge from your title isn't registered until the lender's processing team gets to it, typically 30 to 90 days depending on the lender. Until it registers, your lawyer holds back enough to cover the payout, then releases it to you within a few business days of the discharge being registered. This is the most common reason sellers wait for a final slice of their proceeds.
Adjustment reserve. Property taxes, utilities, and condo fees are prorated between you and the buyer on the statement of adjustments. Because final bills don't always arrive by closing, your lawyer may hold a small reserve, often a few hundred dollars, until the exact figures are confirmed, usually within two to six weeks.
What is the reporting letter, and when is the rest released?
Once the holdbacks are resolved, your lawyer prepares a reporting letter, a formal accounting of every dollar in and out of the transaction, and releases any remaining trust balance. This generally arrives within two to three months of closing, though it's often sooner. If you never hear about a holdback, it doesn't mean something went wrong; the discharge timeline is routine.
Typical payout timeline at a glance
What you receive | When it typically arrives |
Net proceeds (the bulk) | Closing day or the next business day |
Adjustment reserve | 2 to 6 weeks after closing |
Mortgage discharge holdback | 30 to 90 days after closing, depending on the lender |
Final trust balance (reporting letter) | Up to 2 to 3 months after closing |
How can you avoid delays?
A few simple steps keep the payout on schedule:
Give your lawyer your banking details early. Confirm where the proceeds should be wired well before closing day so there's no last-minute scramble.
Tell your lender as soon as the sale is firm. The earlier the lender's discharge team knows, the sooner that process can start.
Confirm the mortgage payout statement is in. Your lawyer requests it, but a quick follow-up avoids a closing-day holdup.
Think twice about a Friday or same-day closing. Mid-week gives the funds room to clear before the weekend.
Knowing the full costs of selling your home, including mortgage prepayment penalties, commissions, and legal fees, before closing means the net figure your lawyer presents won't be a surprise.
Frequently asked questions
Does the seller get paid on closing day in Ontario?
Usually the bulk of your net proceeds is released on closing day, once title registers and funds clear the trust account. Depending on your bank's cut-off, it may land the same afternoon or the next business day.
Why haven't I received all of my money after closing?
Your lawyer typically holds back a portion to cover the mortgage until the discharge is registered (30 to 90 days) and a small reserve for final tax or utility adjustments. Both are released once confirmed.
Is a wire transfer or a certified cheque faster?
A wire transfer is faster and the funds are usable sooner. A certified cheque can be subject to a bank hold of one to five business days depending on the amount and your institution.
How long does a mortgage discharge take in Ontario?
The lender usually registers the discharge within 30 to 90 days of closing. Your lawyer releases the related holdback within a few business days of that registration.
What is a reporting letter?
It's the final accounting your lawyer sends after closing, summarizing every amount received and paid on the file, and accompanying the release of any remaining trust funds.
About the author
Joel Fox is a co-founder and COO at Ownright. He helps run the firm's day-to-day work on Ontario residential closings, refinances, and sales, and writes regularly to demystify the parts of a transaction that most homeowners only encounter once or twice in their lives.
At Ownright, we focus entirely on Ontario residential real estate law. We help sellers and buyers with closings, sales, refinancing, and status certificate reviews, pairing a digital platform that tracks every milestone with an in-house legal team you can reach by chat, email, or video call, including after closing day. If you're preparing to sell, our step-by-step walkthrough of what a sale closing involves is a good place to start. You can start your closing online or get in touch with any questions.
Important note: This article is not legal advice. No one should act, or refrain from acting, based solely on the information in this post or any linked materials without first seeking appropriate legal or professional advice.
