Toronto Real Estate - Glossary of terms
Addendum
The Tarion Addendum (expected to be a joint Tarion/HCRA addendum if the HCRA is designated in early 2021) is a required part of the agreement of purchase and sale for a residential condo and contains important information that both the builder and condo buyer are required to agree to.
Adjustable-rate mortgage
There are two types of conventional loans: the fixed-rate and the adjustable-rate mortgage. In an adjustable-rate mortgage, the interest rate can change over the course of the loan at five, seven, or ten year intervals. For homeowners who plan to stay in their home for more than a few years, this is a risky loan as rates can suddenly skyrocket depending on market conditions.
Agreement of Purchase and Sale
The Agreement of Purchase and Sale contains important information about your rights and obligations as a condo buyer, the builder’s rights and obligations as seller (as applicable), the unit, and the condo construction project.
Amortization
This is the process of combining both interest and principal in payments, rather than simply paying off interest at the start. This allows you to build more equity in the home early on.
Annual General Meeting
Annual owners’ meeting where the board of directors presents to the owners on the financial health of the condo corporation and other business.
Appraisal
In order to get a loan from a bank to buy a home, you first need to get the home appraised so the bank can be sure they are lending the correct amount of money. The appraiser will determine the value of the home based on an examination of the property itself, as well as the sale price of comparable homes in the area.
Assessed value
This is how much a home is worth according to a public tax assessor who makes that determination in order to figure out how much city or state tax the owner owes.
Board Meetings
Meetings attended by board members to manage the affairs of the condo corporation.
By-laws
By-laws are part of the condo corporation governing documents. By-laws govern how a condo corporation operates. By-laws can cover topics such as: the size of your condo board, the process for electing directors, and the format of board meetings. By-laws must be consistent with the declaration and the Condo Act as well as reasonable.
Chargebacks
Charges that are added to the amount of a unit owner’s common expense fees. This may happen, for example, due to a condo corporation handling an owner’s maintenance obligations or where a condo corporation incurs certain court costs in a legal proceeding against an owner to enforce compliance.
Common Elements
All condo property except units.
Common Elements Condominium
A condo corporation that creates common elements but does not divide the land into units. Owners purchase land tied to part of a common element condo corporation in which they also have an ownership interest (such as a shared road, ski hill or golf course) and pay common expense fees.
Common Expense Fees
The amount of money that an owner contributes in the proportions specified in the declaration. These go towards paying expenses (operating and reserve), including for, among other things, the maintenance and upkeep of the condo corporation’s common elements.
Condo Corporation
A legal entity that comes into existence when a declaration and description are registered with the Land Registry Office. All units and common elements are part of a condominium corporation, and condominium corporations are governed by boards of directors on behalf of owners.
Condo Manager
An individual licensed by the Condominium Management Regulatory Authority of Ontario who is hired by a condo corporation to oversee a condo corporation’s day-to-day operations. Condo managers are accountable to the board of directors of the condo corporation.
Condominium Act, 1998 (Condo Act)
The Condo Act provides a legal framework that enables condo owners and their elected board of directors to make decisions about the governance of a condo corporation.
Condominium Authority Tribunal (CAT)
an online tribunal administered by the Condominium Authority of Ontario that is authorized to resolve certain disputes primarily between condo corporations and owners.
Condominium Management Services Act (CMSA)
The CMSA provides a framework for regulating condo managers and condo management providers and requires that they be licensed to provide condo management services in Ontario.
Cooling Off Period
Ten-day period within which buyers of pre-construction condos have the right to rescind, or cancel, a purchase agreement they have signed, for any reason whatsoever. Begins on the later of the date the buyer received the disclosure statement, a copy of this Condo Guide, and the copy of the agreement of purchase and sale.
Declarant
The owner of the land where the condo corporation is being established. *Note that, for ease-of-understanding, the Condo Guide sometimes uses the term “developer” in many places in place of the term “declarant”, which is used in the Condominium Act, 1998. The Ontario New Home Warranties Plan Act also uses the terms “vendor” and “builder”.
Declaration
Governing document that contains important information about the condo corporation, such as the percentage that the unit owner must contribute to the common expenses and a breakdown of the responsibilities for repairing and maintaining the units and common elements.
Description
The description defines the units and the common elements and specifies the boundaries between them.
Declarant-Controlled Board
A condo corporation board including directors appointed by the declarant (i.e. the developer).
Delayed Occupancy
When a unit buyer is unable to take possession of the new residential unit by the firm or outside occupancy dates contained in the Addendum to a purchase agreement. Director / Board of Directors: The individuals who are appointed or elected to manage the affairs of the condo corporation. Directors are responsible for making important decisions and serve for terms of up to three years.
Director Training
Training program provided by the Condominium Authority of Ontario. All condo directors appointed, elected, or re-elected on or after November 1, 2017 are required to complete the training program within six months of their appointment, election, or re-election. Directors do not have to take the training if they have completed the program within the previous seven years.
Disclosure Statement
A document that your declarant must provide when you purchase your unit from them or someone benefiting them, and which includes important information about your unit and the condo corporation (proposed or registered).
Exclusive Use Common Elements
Are common elements that specific unit owners/occupiers have exclusive use of (e.g., a balcony connected directly to a single unit).
Governing Documents
A condo corporation’s declaration, by-laws, and rules.
Information Certificates
Information Certificates help to ensure that owners receive ongoing information about their condo corporation throughout the year. There are three types: Periodic Information Certificates, Information Certificate Updates, New Owner Information Certificates.
Information Certificate Updates
Information certificates which include information on certain key changes before the next scheduled Periodic Information Certificate (such as changes in the directors or officers of the condo corporation). These are to be distributed within 30 days of the change.
Interim Occupancy
When a buyer takes occupancy of their unit before the condo corporation has been registered with the Land Registry Office, and before ownership is transferred to the buyer. The duration of the interim occupancy is called the interim occupancy period, and during that period the buyer is required to pay occupancy fees.
Interim Occupancy Fee
The amount that a buyer is required to pay the declarant during the interim occupancy period.
Interim Occupancy Period
The period from your interim occupancy date to the date ownership is transferred to you.
New Owner Information Certificates
Information certificates which are sent to new owners within 30 days after the new owner provides written notice stating their name and the unit that they own in the condo corporation.
Notices
Notices are documents containing information that an individual is entitled to receive as a unit owner. Notices will be delivered to you in either hardcopy or digitally (if the condo corporation and owner agree to electronic delivery or if that is otherwise permitted).
Owners’ Meetings
Meetings which all owners are invited to. Includes annual general meetings, owner-requisitioned meetings, turn-over meetings, and meetings called by the board regarding the transaction of any condo business.
Owner-Requisitioned Meetings
Meetings requested by the owners to discuss/vote on a specific topic, such as the removal of a director or voting on a rule proposed by the board of directors.
Periodic Information Certificates
Information certificates which focus on the condo corporation’s board, finances, insurance, reserve fund, legal proceedings, and other matters.
Phased Condominium
A condominium that is built and registered in phases. Once the construction is complete, it becomes a standard condominium.
Quorum
The law requires that a minimum number of owners be present (either in person or by proxy) at a meeting. Without quorum, voting cannot take place, however discussion on relevant business is still permitted.
Reserve Fund
A fund condo corporations save and use to handle the larger financial burdens, for major repair or replacements of common elements and assets as needed.
Reserve Fund Study
Determines how much money needs to be in the reserve fund to ensure the major repairs/replacements can be paid for in the future. The reserve fund study must be prepared by a specialist, like an engineer. The board of directors approves the study, then informs owners of the results of the study.
Rules
Rules are part of the condo corporation’s governing documents. Rules exist for the protection of those living in the condo corporation as well as the protection of the assets of the condo corporation itself, and to prevent unreasonable interference with the use and enjoyment of the units, common elements, and assets of the condo corporation. Rules must be consistent with the Condo Act and the declaration and by-laws of the condo corporation as well as reasonable.
Special Assessment
An extra one-time charge added on top of an owner’s common expense fees.
Standard Condominium
The most common type of condo corporation in Ontario, where the condo corporation is made up of units and common elements.
Statement of Critical Dates
The Statement of Critical Dates can be found in the Addendum to your purchase agreement. The Statement contains the dates you can expect to take occupancy of your unit, as well as other important information.
Status Certificate
A document that anyone can request from a condo corporation and which contains important information about the unit and condo corporation.
Turn-Over Meeting
The meeting held by the declarant-controlled board within 42 days of the declarant ceasing to own a majority of the units. At this meeting, the owners will elect a new board and the declarant-controlled board will turn over several items to the new owner-elected board.
Vacant Land Condominium
A type of condo corporation in which the units may be vacant lots at the time of purchase, and the condo corporation may resemble a subdivision. Common elements are often things such as roadways, sewer systems, and amenities such as parks or recreation facilities.
Post a comment