THINKING OF GETTING A CONDO STATUS CERTIFICATE? HERE’S WHAT YOU NEED TO KNOW

In today’s real estate world, condo status certificates are actually quite popular. Formerly called
Estoppel, a condo status certificate is arguably one of the most important pieces of legal
document you’ll need when purchasing a condo. This is primarily because they contain the
details of what you’ll be acquiring in clear and concise terms that go a long way in preventing
unforeseen complications later on.

Before Moving on, what Exactly is a Condominium Status Certificate?

Well, without delving too deeply into legal terminologies, a condo status certificate is what
condominium agencies or companies issue buyers of condominiums that are being resold.

As provided for in Section 76 of the Ontario Condo Act, a condo status certificate is expected to
provide all crucial information pertaining to the condo. This expressly includes everything from
the financial status of the unit in question to details from the condominium corporation in charge
of the property.

In simpler words, this document provides the prospective buyer of a condo with the necessary
information on the physical as well as financial condition of the property about to be bought. It
generally also includes other details such as the regulations to be followed when living in the
unit.


What Should you Expect to Find in a Condo Status Certificate?


In addition to the various points mentioned previously, some other bits of information you can
expect a condo status certificate to include:

  • By-laws
  • Condo declaration
  • The contact information of the condominium management body
  • Information on the reserve fund
  • Information on insurance policies
  • Rights reserved, as well as,
  • Rules and guidelines for the units’ use.

Typically, you’ll also find information on the previous annual general meeting held. This is
presented in form of the minutes of the meeting. In addition, details concerning the board and
corporation such as rules and legal matters like lawsuits will also be contained in this document.
However, if the lawsuit hasn’t begun yet, it is possible that the condo status certificate won’t
contain any information about such legal action.

Other relevant content that are a core part of the condo status certificate are:

  • Fiscal information about the condo with regards to the individual in current possession of
    the unit. This is done so you can determine whether the common monthly costs are being
    covered and that payment on those are up to date.
  • Information on the reserve fund study such as how much money is left in it and other
    details.
  • An outline of the rules and insurance policies governing the common areas.
  • Any information regarding common costs, such as if there will be an increment in the
    amount of money paid for them.

An ideal condo certificate should also contain a detailed report of what common expenses to
expect as well as receipts for the budget of the year. All of this will help you see exactly what
you’ll be dealing with as you get a clear insight into the financial status of the unit.

Interested buyers are usually to be in possession of this document within a 10-day period from
the date of request. Also, upon obtaining this certificate, you’re expected to consult with your
real estate lawyer and go through the entire document together carefully.

In places like Toronto, Ontario, a condo certificate is considered no longer of material relevance
if it exceeds 30 days the request time. This is one reason why it is always advisable to consult
your lawyer so it’s all actions follow due process

Do I Need a Condo Status Certificate?

While it is certainly possible to do just fine without one, getting a condo status certificate has
numerous benefits that cannot be easily dismissed. For one, this document helps you know
precisely how this unit is being managed. This gives prospective buyers of the condo an unbiased
analysis of the legal and financial situation of the property.

Condo status certificates also carry information such as the managements’ position on owning
pets, rules and regulations concerning common areas and so on. It gives willing buyers a headsup on what to expect moving forward, allowing them the time and opportunity to mull things
over. These are information that mightn’t be obtained in the absence of a condo certificate. In
addition to this, most lenders financing these types of units specifically request this document,
making it essentially invaluable in this case.

What Happens when a Condo Status Certificate is Missing Something?

From time to time, some finer points of the certificate might turn up absent from the document.
This might be due to things like maintenance work being carried out after the buyer might’ve
signed the final resale agreement or some other unexpected factor. When things like this occur,
complications may arise. It could also lead to conflict between the owners and the manager.

Condominium corporations generally usually have a good idea of the amount of money each unit
incurs through common expenses. It mightn’t be very precise but it’s usually enough to derive a
general amount of the additional funds used. Of course, neglecting to announce changes such as
an increment in fees or special assessments can result in false advertizing being carried out.
However, all of this can be subsequently included in the annual reserve fund study.

If, however, the status certificate clearly makes mention of the special assessments, the owner is
obligated to make the payments incurred from that expenditure. This is one major reason why as
a buyer, you go need to go through the condo agreement with a fine tooth comb.

How Much Does a Complete Condo Status Certificate Cost?

Under the provisions of the Condominium Act, the management body (be it the board or the
property manager) may charge a sum of $100 for provision and issuance of the condo status
certificate.

It should be noted that the cost of this document and the party (be it the buyer or seller) who pays
for it is dependent on various conditions. For example, if the parking space of the unit isn’t
owned by the same agency, the price of the document may prove disparate. Also, if you’re
requesting the document be delivered posthaste, the price of the document may be significantly
increased.

In places like Ottawa, Ontario, it is the prerogative of the buyer to procure the document while in
Toronto, reverse is the case. Today, getting a condo status certificate has been made an easy and
simple process. All you usually have to do to get one is put a request through to the management
board or request it online.

All in All

Getting a condo agreement does you a lot of good. Besides helping you know what you’ll be
getting into in certain and clear terms, it is actually a very important document to have when
dealing with lenders.

Also, it’s very crucial you don’t try to go through this entire process on your own. The counsel of
your real estate lawyer and financial advisor is indispensable. In addition to helping you interpret
the more complicated legal aspects of the document, they may also end up representing you in
court. This is why it is vital you get a lawyer who is highly skilled at navigating the legal terrain.

Take your time to thoroughly go through each document and certificate that relates to buying your condo as opposed to renting, so, you fully understand their finer points and pinpoint any potential areas of
concern.

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