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The Importance of Offer Review |
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By: Jayson Schwarz
One of the most serious issues facing a homebuyer and it does not matter whether you buy a house, condo, townhouse, new or resale is the Agreement of Purchase and Sale or Offer. Over the last few months I have had a number of people bring me their Offer long past the time when they can have a lawyer comment on it and they were stuck with the terms and extra expense. Let’s review.
Condominiums: S. 73(1) of the Condominium Act provides that you have ten (10) days from the later of, the date you receive the disclosure statement and the date you receive an Agreement of Purchase executed by the Builder to rescind the deal. This gives you an opportunity to see your lawyer, get suggestions, changes, and explanations and then within the ten (10) days return to the sales office and negotiate for those important items that are usually left open and I will describe later.
New Homes and Resale homes or Resale Condos: No time is allowed after you sign unless you have ensured that there is a schedule or clause making the transaction conditional for a given period of time on your lawyers review and approval. This gives you an opportunity to see your lawyer, get suggestions, changes, and explanations and then return and negotiate.
Here are a number of items to look out for so you have an idea, but recognise this is not a comprehensive list, just a sampling:
- Hydro and water installation and subdivision charges - get written maximums put in;
- Development charges and levies - get deleted or written maximums;
- The vendors lawyers’ Law Society Levy - get it deleted - you pay yours, they can pay theirs;
- Driveways - they say it is paved, does that mean base and finish coat or only a base coat?
- Damage deposits - get a maximum and make sure there is a process for obtaining a refund
- Mortgage clauses - are you stuck with the builder’s mortgage and terms? is there a clause requiring you to accept the builder’s lawyers undertaking to discharge the mortgage without a discharge statement or direction to pay funds to the lender? is the builder trying to make you pay to obtain partial discharges of a blanket mortgage
- Condos – do you own your parking and storage locker or is it only exclusive use?
- Survey – who pays? When do you get it?
- Extensions – how long? Are you contacting out of your Ontario New home Warranty rights?
- Title – is there a clause that says you have to accept the builders undertaking to give you a deed if one is not available on Closing.
There are many more issues that arise in an Agreement of Purchase and Sale or Offer. This document is the most important in the whole process because it sets the rules for you and the vendor. This becomes critically important when you realise that you need independent legal advice that will properly help you deal with this document. Only a lawyer can do this. If you are directed to a closing centre, make sure before you go there that a lawyer not employed or retained by the closing centre reviews your documents and gives you the opinion and advice to allow you to move ahead safely. Good luck and happy home hunting!!!!!!!!!!!!!!! |
