Understanding your statement of adjustments

Think of the statement as the purchase-price reconciliation between the parties. It begins with the agreed price and accounts for applicable credits and adjustments. Its purpose is to ensure each party bears the amounts assigned to them under the agreement, rather than assuming every bill was paid on the closing date.

The exact entries depend on the contract and property. A condominium, an oil-heated house and a newly built home can have different items. Ask your lawyer to explain any unfamiliar line and confirm the documents supporting it. A label alone is not enough to tell you whether an amount is correct or whether it belongs to the buyer.

Property tax is a common adjustment because a billing period may extend across the closing date. If the seller has prepaid an expense covering part of your ownership, a buyer reimbursement may be appropriate. Where amounts remain unpaid, the accounting may work in the other direction or require another arrangement through the lawyers.

Ask which period the bill covers, whether the figure is actual or estimated and how the closing day is treated. Do not substitute your mortgage’s monthly property tax collection for the municipality’s actual bill. Those payments to a lender and the buyer-seller allocation answer different questions. If the adjustment uses an estimate, ask whether and how a later correction is handled.

For an oil-heated property, ask whether fuel remaining in the tank is being adjusted, how the quantity is established and what pricing evidence is used. Do not assume the seller’s most recent delivery invoice proves the amount left at closing. The agreement and the parties’ lawyers should settle the method.

With a condominium, check how regular fees, arrears and any special assessment are treated. Review those entries with the estoppel certificate and the agreement, not just the listing. Other prepaid items may appear if the contract calls for them. A shared expense should be identified clearly enough that you can understand the period, the allocation and the supporting evidence.

A deposit already delivered in trust is normally credited toward the purchase funds at completion. Check that the amount matches your receipt and that any later deposit increase is also accounted for. The deposit is not a discount on the price; it is money you have already contributed.

Keep the seller balance separate from the total you personally need to send to your lawyer. Mortgage proceeds, remaining down payment, legal fees, tax and other closing disbursements affect that broader calculation. Ask for a reconciliation if the documents appear inconsistent. It is easier to resolve a missing credit before sending funds than to discover the mismatch while arranging the move.

Request enough time to compare the draft with the agreement, deposit receipts and available bills. Highlight dates, names and amounts that differ from your records. Ask whether the statement is final or subject to a last-minute update, particularly if the closing date has moved. Keep the revised version rather than relying on an older email total.

Your lawyer should confirm the final trust amount, payment method and deadline separately. Verify changes in banking instructions through a known telephone number. After closing, retain the final statement with your legal reporting documents. It can help explain what you paid and provide a useful starting point if a later bill or agreed readjustment needs review.