People buy condos for various reasons. Most buyers prefer condos to single-family houses mainly because of their affordability, shared responsibilities, and amenities. However, some buyers don’t request a status certificate when buying a condo, and this can cause them some serious trouble in the future.
Our house experts will explain what a condo status certificate is and why requesting it is crucial.
What Is a Status Certificate?
A status certificate is a document that provides all the vital information concerning the fiscal and physical situation of the unit and the condo corporation. The main focus of this document is to inform owners of any fee increase that may come into effect or any special assessment as stipulated by the board.
A condo certificate proves to a buyer that the fiscal situation of the unit is in order. That provision for maintenance has been made should any issue of repair arise in the future. Therefore, if payments are overdue or you refuse to pay certain fees, legal actions, as stipulated in the condo certificate, will come up against your unit.
The condo board issues this document to anyone that buys a condo unit, and a management company typically prepares it. Should there be any vital information omission in the status certificate, the board is ultimately responsible for such an act. They will bear the cost of whatever they try to impose on the owner.
For example, if a special assessment period is announced and the owner is asked to pay $2000, the owner might refuse to pay anything as stated in the status certificate.
Important Information Outlined on a Status Certificate
Essential information outlined on a status certificate includes the fees and increment, legal actions, arrears, by-laws, budget, reserve funds, insurance, condo rules, condo declaration, etc . Other useful information in the certificate includes lawsuits involving the condo corporation and the board, as well as minutes of the last general meeting.
The financial statement outlines expenses, receipts of the year, and the total money remaining in the reserve fund. Generally, the document clarifies the finances and helps the condo corporation manage the units better.
A condo certificate may not have legal information regarding arbitrations and meditation, and as such, there will be no information about the costs. However, it may reflect in the declaration for a special assessment.
Purpose of a Status Certificate
The purpose of a status certificate is for buyers to have access to all the information they ought to know about their condo unit. This includes the unit’s physical and financial status and information about the condo corporation. A status certificate helps to prepare buyers for anything that may arise in the future.
Additionally, it allows prospective buyers to find out the condo rules, including whether animals and certain outside patio furniture are allowed. You will have more details about shared balconies and common areas.
The document is vital information that ensures the board is accountable for its spending and funds use. It also shows that there are enough reserve funds to take care of any unforeseen incidents. Without these vital pieces of information, you may not know if the condo unit you are buying is insured, in line with regulations, or subject to investigations.
How to Get Your Condo Status Certificate
A prospective buyer can get a condo status certificate by requesting it from the management and condo boards. You can also order it online. You should receive your document within ten days of application and payment.
However, you should know that each condo unit’s certificate may be slightly different from the other because each certificate lists arrears and changes in the exclusive use of common properties. It’s crucial that all prospective buyers go with their lawyers to carefully examine their status certificates to ensure everything is in order.
If the contents of the clause are not in order or found unacceptable by the buyer, he or she may refuse to accept it. You and your lawyer are given up to 72 hours to go through the certificate before deciding.
In line with the Condominium Act, property managers are compelled to charge $100 for the status certificate. The buyer pays the fee to the management company or the condo corporation, depending on what’s stated in the management contract. However, the prices can be increased if you are requesting an accelerated status certificate.
Some areas require that the seller pays the certificate amount and not the buyer. For instance, in places like Toronto, it is the seller who pays the certificate amount. However, it’s different in Ottawa — it is the buyer who pays the certificate amount.
Read more: Real estate agents recommended apps
What is a status certificate?
A status certificate is a document issued by the condo corporation to prospective buyers of resale condos, containing the date that the certificate was issued, budget, and other legal information. This document has all the information about the unit, including if there are additional financial liabilities associated with the purchase.
How do I get a status certificate?
You can get a status certificate by providing a written request and paying a hundred-dollar fee to the management company or condo corporation. However, you can only request a status certificate as a prospective buyer of the condo.
How long is a status certificate valid in Ontario?
A status certificate is valid for sixty days in most cities. In Ontario, the certificate will be declared stale if it’s thirty days older. If the document is no longer valid, your best option is to request a new status certificate.
Our housing experts reiterate that a condo status certificate is an essential document if you want to purchase a condominium. This document ensures that you know everything that there’s to know about your condo unit to avoid getting involved in legal issues later on.
When issued a condo certificate, you should endeavor to go through the details with your lawyer. You will get a clearer understanding of what’s demanded of you and the condo corporation for peaceful living.