Why Is A Condominium Status Certificate Important?
At Brown Beattie O’Donovan, one of the first questions many condo purchasers have is: “What is a condominium status certificate and why do I need this condition in my Agreement of Purchase and Sale?” We’re happy to answer this frequently asked question.
What is a Condominium Status Certificate and why should you get one?
A Status Certificate is a set of documents produced by the Condominium Corporation which provides essential information about the financial and legal status of the Condominium Corporation and the particular unit the purchaser is interested in buying.
The Agreement of Purchase and Sale for a Condominium unit will typically be conditional on the review of the Status Certificate by the purchaser’s lawyer. The purchaser’s lender will require the Status Certificate prior to advancing funds to the Purchaser.
Basic information in the Status Certificate
- Legal registration of the corporation, address and any easements
- Contact information for the Board of Directors and Property managers
- Whether the unit owner is current or in arrears in paying the monthly maintenance fees
- Whether or not there is any special assessment for the units or building
- Boundaries of the units
- Duties and rights of the condominium corporation and of the individual owners
- Percentage of ownership of each individual unit and the amount that unit contributes to the common elements
Financial and insurance information in the Status Certificate
- Copy of the current budget
- Details of any increases in common elements or special assessments in the current year
- Audited financial statements for the previous year
- Certificate of insurance for the building
- Any requirements on the individual owners to get unit or liability insurance
- List of all agreements the Condominium Corporation is party to
- How much money is in the Reserve Fund
- A summary of the Reserve Fund Study
Legal information that may be in the Status Certificate
- Details of any judgments against the Condominium Corporation.
- Details of any pending lawsuits (both against and by the Condominium Corporation).
Rules, By-laws, and Regulations in the Status Certificate
- Pet restrictions and rules
- Visitor rules and visitor parking
- Rules surrounding renting out your unit
- Use of the common elements
- Requirements if you want to make alterations or renovations to your unit
- Decor rules
- Noise and smells rules
- Parking and locker rules
- Balconies and terraces rules
- Obligations re: repairs
Having the Status Certificate reviewed by a real estate lawyer is a critical part of buying a Condominium unit as it is the best way to safeguard your investment. For more information about purchasing a Condominium unit, contact the team at Brown Beattie O’Donovan — we’ll here to answer all your questions.