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Any offer or counter-offer can be withdrawn before the other party formally accepts it (that is, with his or her properly witnessed signature). It can also be withdrawn if there is a time limit on the offer or counter-offer and it passes without being accepted.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.
Purchasing a condominium involves many legal and financial documents. It is a good idea to have your lawyer assist you to ensure that you understand all the documents and obligations that apply to the condo and your unit. For more information, view Ontario’s Condominium Act, or refer to the Condominium Authority of Ontario (CAO) Residential Condominium Buyers’ Guide.
Need help with a Deposit?
A Deposit Rocket Guarantee provides a stress-free alternative to obtaining a deposit. You do not need to borrow from friends and family, liquidate investments and pay breakage and interest fees, or obtain certified cheques, a line of credit, or bridge financing. Deposit Rocket issues a Guarantee that your Realtor submits along with your offer, instead of a cash deposit or certified cheque. For a quote, use the Fee Calculator .
The online application takes only minutes to complete. Visit Deposit Rocket to apply for a Deposit Guarantee.
You now haveoptions: