Area of Law: Real Estate Law
Answer # 418
Cancelling an offer or purchase agreement for a condominiumRegion: Ontario Answer # 418
Any offer or counter-offer can be withdrawn before the other party formally accepts it (that is, with his or her properly witnessed signature). It can also be withdrawn if there is a time limit on the offer or counter-offer and it passes without being accepted.
An agreement for sale may also be terminated if it becomes impossible to perform through no fault of either party (lawyers say such a contract is “frustrated”). An example is property destroyed in a flood or a fire before the buyer has taken possession. Purchasers of new condominiums in Ontario have a 10-day cooling-off period to back out of purchase agreements.
Once the offer or counter-offer has been formally accepted, however, the buyer and seller are bound legally by its terms. If you walk away from a deal you will not only lose your deposit, but may also be liable for any damages suffered by the other party, such as the lost opportunity to sell to someone else, expenses arising from a delayed move, or the seller’s loss of deposit on another home intended for purchase. The legal remedy, called “specific performance” (making you complete the purchase), is an unlikely event, but a court could still hold you responsible for the entire purchase price, plus expenses and court costs.
If you are buying a home and want to know how much of a mortgage you qualify for, use the Scotiabank mortgage calculator .
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