Buying a Condominium

It is strongly recommended that you obtain expert legal advice from a real estate lawyer who understands condominium law and the processes before to buying a condominium to prevent typical financial mistakes that many ignorant or ill advised home buyers make. nightmare.

Understand the following before making an offer:

• Details of the condominium unit and common property
• Rights and responsibilities of ownership
• Amount of monthly condominium fees
• The existence of, or lack of, reserve funds and special assessments

Obtain with your Real Estate Agent the following documents before finalizing your purchase:

• Estoppel Certificate
• Certificate of Insurance
• Financial Statements of the Condominium Corporation
• By-laws of the Condominium Corporation

The Agreement of Purchase and Sale typically provides that the purchase is conditional upon the provision of the "Status Certificate" by the seller for review and approval by the buyer. It is recommended that this Document be given to a real estate lawyer for review and advice. Your real estate lawyer will then review all the documents that come in the package and advise you on the viability of the property you intend to buy. Bear in mind that a Condominium unit unlike a single-family detached home is affected by the collective status of the Condominium Corporation.

The Estoppel Certificate

The Condominium Corporation provides this document which certifies:

• The status of the monthly condominium fees; particularly with regard to your unit.
• Evidence of (or lack of) of special assessments
• Evidence (or lack of) liens or charges against the title exist

This certificate serves as a protection against future claims if any of the above certifications are found to be inaccurate.

The Certificate of Insurance

This document should be reviewed to determine the adequacy of insurance coverage on both the individual units and the common property in the Condominium.

The Financial Statements

The Financial Statements of the corporation will give you insight into the viability of the condominium corporation as follows:

• An insight of the financial position and quality of financial management of the corporation
• Sufficiency of the corporation's reserve fund
• Sufficiency and reasonableness of the corporation's budget

Here your accountant (or an accountant)can review the corporation's financial statements to provide a better analysis of the numbers in the report.

Condominium Bylaws

You and your real estate lawyer should carefully review the condominium bylaws to determine if there are any issues you find unacceptable.

The bye-laws will include:

• Information on the operation and management of the corporation
• Condominium board election and meeting procedures
• Rights and restrictions on the use of individual units and common property
• Responsibilities of owners