When you’re buying, selling, or refinancing a home, it’s easy to focus on the big stuff, like your mortgage rate or moving day. But there’s a set of documents that often fly under the radar and can have a considerable impact on your budget: the statement of adjustments (SoA) and the trust ledger statement.

These aren’t just legal forms to sign and forget. They’re the breakdown of how much you’ll pay, or receive, once everything’s said and done. Think of them like your deal’s final receipt, showing every dollar that moves before the keys change hands. If you’ve ever wondered where your deposit goes, why closing costs vary, or how legal fees show up in your total, these documents hold the answers.

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Key Takeaways

• A statement of adjustments shows the final amount the buyer owes or the seller receives at closing.
• A trust ledger Statement tracks where all funds go, from deposits to lawyer fees and taxes.
• Reviewing both documents ensures financial transparency when buying, selling, or refinancing a home in Canada.

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What Are Statement of Adjustments and Trust Ledgers?

Buying, selling or refinancing a home involves a lot of paperwork, and two of the most important legal documents you’ll encounter are the statement of adjustments and the trust ledger statement. These forms clearly show how money is distributed on closing day, and more importantly, how much you’ll pay or receive.

Understanding these documents isn’t just about peace of mind. It’s about knowing the actual cost of your real estate transaction. Whether you’re preparing to buy your first home or refinancing your current home or mortgage, getting familiar with what’s in a statement of adjustments and trust ledger can save you from surprises when it matters most.

What is a Statement of Adjustments?

Think of the statement of adjustments as a closing-day balance sheet. It lists what is owed, what has already been paid, and what remains to be settled to complete the home purchase or sale. Your real estate lawyer or notary prepares this document and typically includes:

• The agreed-upon purchase price
• Any deposits already made
• Adjustments for prepaid expenses, such as property taxes, condo fees or utilities

Buyers use this to understand the exact amount they need to provide at closing, after accounting for deposits and reimbursements. Sellers use it to calculate the amount they’ll receive after adjustments.

Example of a statement of adjustments

Here’s a simple scenario:

• Purchase price: $750,000
• Deposit paid: $30,000
• Prepaid property taxes: $7,324 (buyer owes for part of the year)
• Prepaid utility bill: $246 (buyer reimburses seller for unused portion)

The final balance owed on closing would be:

$750,000 + $7,324 + $246 – $30,000 = $727,570

This amount would be listed under “Balance Due on Closing” in the buyer’s statement of adjustments.

What is a Trust Ledger?

The trust ledger tracks the full flow of funds on closing day. It picks up where the statement of adjustments leaves off and shows precisely how the money will be disbursed.

Prepared by your lawyer or notary, the trust ledger for buyers will show:

• Amount owed to the seller
• Legal fees and disbursements
• Land transfer tax
• Title insurance
• Other costs, like home inspection or appraisal fees

The seller’s trust ledger lists:

• Final amount received from the buyer
• Deductions such as legal fees, realtor commissions, or mortgage payouts

Buyer vs Seller Trust Ledgers

The structure of the ledger is the same, but the entries differ depending on your role in the transaction:

Buyers will see their total funds (from mortgage loan and down payment) on one side, and all disbursements (to seller, government, and legal services) on the other.

Sellers will see the amount received from the buyer, with deductions like commissions and remaining mortgage amounts.

Example of a Trust Ledger

Let’s return to our $750,000 home purchase example. The buyer has:

• $600,000 from the mortgage
• $140,000 down payment
• Total funds: $740,000

Disbursements:

• $727,570 to the seller
• $13,000 in combined closing costs

This matches the total funds of $740,570.

The seller’s trust ledger shows:

• $727,570 received
• Minus $30,000 in commission
• Minus $920 in legal fees
• Final proceeds: $696,650
  

How Is the Trust Ledger Different for a Mortgage Refinance?

In a refinance, you won’t receive a statement of adjustment; instead, you will only get a trust ledger, as you’re not transferring ownership, but rearranging how your mortgage is structured.

Your trust ledger in this case might include:

• New mortgage amount
• Old mortgage payout
• Debts or bills you want to consolidate
• Legal fees and title insurance
• Remaining funds returned to you

Let’s say you complete a mortgage refinance for $580,000, and your old mortgage was $410,000. After paying off $20,000 in debts and $1,000 in fees, you keep $149,000.

Why Do Statement of Adjustments and Trust Ledgers Matter

Understanding these statements means you won’t be caught off guard. These documents confirm your legal obligations and entitlements, and they protect both parties in the event of a dispute. They also help ensure that everyone’s expectations are aligned before closing.

Since these statements encompass tax and legal implications, they are a crucial component of the real estate process. Your lender will typically request them for funding purposes.

How to Review Your Statement With Confidence

It can be tempting to skim these forms, especially if you’re juggling moving day logistics. But a careful review can prevent costly mistakes. Here are a few tips:

• Confirm that the purchase price, deposit, and adjustments match what was agreed upon
• Make sure prorated charges (prepaid property taxes and utility bills) are dated properly to your closing date
• Verify that the trust ledger totals align with your expectations based on previous discussions
• Ask your lawyer to walk through the documents with you in plain language

Taking the time to understand these details will give you peace of mind during one of the most crucial financial moments in your life.

Frequently Asked Questions (FAQ) on Statement of Adjustments and Trust Ledgers

Final Thoughts

There’s a lot to manage when you’re buying, selling, or refinancing a home, and it’s normal to feel a bit lost in the paperwork. The good news is that once you understand how the statement of adjustments and trust ledger work, you’ll have a much clearer picture of what’s happening with your money on closing day. These documents help confirm that everything’s accounted for and that the funds are flowing exactly where they should.

While your real estate lawyer or notary will walk you through the legal side of things, it’s just as essential to make sure your mortgage numbers align with what you’re expecting. If you’re not sure how your rate, down payment, or loan amount will influence your final figures, a nesto mortgage expert can help break that part down. We’re here to ensure the financing aligns with your unique circumstances and expectations.

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Why Choose nesto

At nesto, our commission-free mortgage experts, certified in multiple provinces, provide exceptional advice and service that exceeds industry standards. Our mortgage experts are non-commissioned, salaried employees who provide impartial guidance on mortgage options tailored to your needs and are evaluated based on client satisfaction and advice quality. nesto aims to transform the mortgage industry by providing honest advice and competitive rates using a 100% fully digital, transparent, seamless process.

nesto is on a mission to offer a positive, empowering and transparent property financing experience – simplified from start to finish.

Contact our licensed and knowledgeable mortgage experts to find your best mortgage rate in Canada.

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