What Is A Statement Of Adjustments And Trust Ledgers?

March 9, 2023


If you’re buying a home in Edmonton, you’ll probably come across the terms “Statement of Adjustments” and “Trust Ledgers” as you move through the home-buying process. But what do these terms mean? In this article, we’ll explain what Statements of Adjustments and Trust Ledgers are, how they can affect your home purchase and how they can benefit you. Keep reading to learn more!

What Is A Statement Of Adjustments And What Does It Include?

A Statement of Adjustments is a document which outlines the various amounts already paid and those still owing, similar to the statements you might get for your personal bank statement. In essence, it shows the final amount the buyer owes to the seller on closing.

For home buyers in Edmonton, it’s important to understand the Statement of Adjustments as a part of closing a real estate transaction because it’s an important document when you want to purchase real estate.  

For example, it takes into account the adjustment for deposits, current utility bills and other outstanding expenses (some of which might be costs paid already) which need to be paid before or at closing. The Statement of Adjustments also accounts for costs such as property taxes, homeowner’s insurance, land transfer tax, and other fees. And amounts already paid are offset against the purchase price of the home.

Example Of A Statement Of Adjustments

Home Purchase Price $350,000
Property Transfer Tax $5,000
Deposit/Down Payment (20%) $70,000
Property Taxes $1,620 $3,285
Title Insurance $500
Legal Fees $900
TOTAL $73,020 $353,285


In this example, the final amount owed to the seller would be $280,265 ($353,285 – $73,020)

While it might seem confusing, understanding a statement of adjustments is quite straightforward, similar to looking at any other bank statement. It shows the various debits and credits with a balance at the bottom. For the buyer’s side, any deposits previously paid will be listed under “debit,” while any payments due such as the purchase price of the home and prepaid items are listed as “credits.”

At the end of it all, subtracting the deposit from the total amount in the credits column will give you an exact figure of what needs to be paid to the seller on closing day. Once that’s determined, the amount is then transferred to the buyer’s trust ledger statement.



What Is A Trust Ledger?

A trust ledger looks fairly similar to a statement of adjustments, so it’s easy to confuse the two, but there are some crucial differences. Basically speaking, a trust ledger is a record of all the money that changes hands as the sale of the home closes. This includes the mortgage loan amount, deposits, legal fees, property taxes and other amounts paid to different parties as part of the closing costs

A trust ledger statement is usually prepared by the lawyer or notary handling the sale and can be used as proof that funds have been received from both the buyer and seller if a dispute arises after the transaction is concluded.

Example Of A Trust Ledger Statement

Mortgage From Lender $280,000
Down Payment From Buyer $70,000
Paid to Seller on Closing $281,765
Alberta Land Transfer Tax $324
Legal Fees $1,500
Title Insurance Fee $300
Total Closing Costs $2,124
Total $283,889

Why Are Statements Of Adjustments And Trust Ledgers Important For Home Buyers?

Understanding statements of adjustments and trust ledgers is essential for anyone looking to buy a home in Edmonton. Both documents are extremely important for ensuring all financial details related to purchasing a home are accounted for during closing. 

Both the buyer and the seller need to pay special attention to these documents to ensure things are done according to best practices, so investing time and energy into understanding them is definitely worth it!

signing paperwork


How Can Home Buyers Use Statements Of Adjustments And Trust Ledgers To Their Benefit?

Often when considering the purchase of a home in Edmonton, home buyers may feel overwhelmed by all of the different financial documents involved and unfamiliar terms. However, Statements of Adjustments and Trust Ledgers can actually be extremely beneficial.

These documents can help many new home buyers understand the prices of certain items reflected in the amount due at closing. Having easy access to these two documents can greatly reduce stress and confusion on closing day, granting buyers a clearer understanding of their financial status. 

Understanding Statements of Adjustments and Trust Ledgers can be overwhelming but it doesn’t have to be! Home buyers in Edmonton should absolutely take advantage of these tools as they can provide invaluable insight into the financials associated with their purchase. Both are great resources for helping buyers keep track of incoming and outgoing payments so they always know exactly where they stand financially. If you’re uncertain or unsure about anything related to statements or ledgers, don’t hesitate to contact us today. Our experienced staff are standing by ready to help with any questions you may have. Don’t wait – start taking control of your home ownership finances today!

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About the Author:

At Sterling Homes, our mission is to provide the opportunity for affordable homeownership without compromise. Over the last 70 years, Sterling Edmonton has quickly become one of Edmonton’s most popular builders. We bring more than seven decades worth of exceptional customer service, superior design and unparalleled craftsmanship to the greater Edmonton area. As a member of the Qualico Group, Sterling Homes focuses on greater Edmonton’s finest family communities, while being able to offer some of the region’s most family friendly prices thanks to volume purchasing power for materials, trades and land. This has not only made Sterling one of Edmonton’s bestselling, move-up builders, but also one of the industry’s most respected home providers. It is through our uncompromising commitment to our customers that we proudly deliver the Sterling Advantage – that’s why each and every home we build includes a 10-year home warranty, a completion guarantee and new home warranty excellence rating. Our Advantage is our pledge that, when you build your dream home with Sterling, we will deliver a timely, well-built home you’re sure to enjoy for years to come.

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