Cooling Off Period

by Darrin DeRoches June 26 - July 2, 2014

When buying a new condo in Ontario there is a ten day “cooling off” period where you are allowed to walk away from the deal. This is when you can take stock of what the condo has to offer and if you bought the right condo. Your deposit has to be returned to you in full and you can walk away from the deal with no deductions. This only applies to “new” condos and not resale condos, but if you are working with a real estate professional they would have similar clauses to enable you to rethink your purchase.     This cooling off period is a time to get your lawyer to look at all the documents. A condo developer can put in a lot of clauses and descriptions that may or may not be what a buyer wants. There can be hidden fees; costs etc. and a buyer will want to have their lawyer take a good look at all the documents. The buyer will also want to check out other developments around the new condo to make sure their views, amenities and overall prosperity of the development will be delivered as laid out in the sales brochure. During these ten days, a buyer should also get their bank involved to make sure that they will have a mortgage on the unit once it is completed. If a bank does not like the development, they may not fund your mortgage.     Most of the legal and financial things will work themselves out during these ten days but buyer’s remorse may kick in. This is usually the biggest problem with people walking away. In most new sales of condos there is a big kick off and frenzy can occur. New buyers get caught up in buying a condo and they do not really take into consideration all of the factors. A couple of days later you tell your friends and family about your new purchase and someone who thinks they know it all starts to put doubt in your mind. They ask how much did you pay per sqft? What floor is it on? Do you know what else is in the neighbourhood? You answer all their questions and no matter what you tell them – you are a sucker!     No one is happy that you just bought a new condo and most likely will make thousands if not tens of thousands of dollars on your investment. They will tell you that you paid too much per sqft. Who is going to live there? You have no view. Everything and anything to discourage you from completing the deal. You can tell them the project sold out and that you made thirty to sixty thousand dollars on the unit once it is completed. They will still give you an opinion on why you should walk away because they are jealous.     During your ten day cooling off period, take everyone’s opinion into consideration but remember why you made the decision to buy in the first place and close on the deal. Trust your gut, do not be influenced by others’ opinions, and look at the numbers – they do not lie. V     Darrin DeRoches is a local real estate and mortgage broker. He can be reached to answer questions, comments or stories about real estate experiences through this weekly column at sold@uniquerealty.ca.