What to expect when buying a new home
(NC)—Purchasing of a new home is a big decision and can sometimes seem overwhelming. Finding the right location, size and finishes are all exciting parts of choosing the home that's right for you, but there are many other important steps to consider. Let Tarion walk you through some of the stages of purchasing your new purchase:
Signing the purchase agreement Once you've decided on the right home, your builder will ask you to sign an agreement of purchase and sale. Before you do, make sure you understand the terms of the deal you are signing; what is and isn't included in the price; and when your closing date will be. It is also important to check that anything promised by your sales representative is reflected in writing. This includes any upgrades you've agreed on. Purchase agreements are typically very lengthy documents and the language can be technical and hard to understand. Invest in a lawyer to thoroughly review the document. He or she will act in your best interest and work with you and the builder to ensure you understand the agreement before signing.
Making a deposit After an agreement is signed, your builder will ask for a deposit or series of payments over time. Deposit protection is a part of your new home's warranty. It ensures that deposits are protected up to a maximum of $40,000 for freehold homes in the event that your builder goes bankrupt, breaches the purchase agreement or in situations where you are legally entitled to back out of the purchase agreement before closing.
Deposits made on condominiums are protected for similar circumstances, up to a maximum of $20,000. Deposit amounts exceeding that are protected under the Condominium Act.
If upgrades and extras have been included in your purchase agreement, your builder may ask you to pay for some or all of these items prior to closing. Be aware that many purchase agreements stipulate that payments for upgrades and extras will not be refunded under any circumstance, so it is a good idea to understand the terms of payment for these items before you agree to them.
Closing on your new home Before you move in to your new home, your builder is required to take you through a pre-delivery inspection, also known as a PDI. At this time you and your builder are looking for any items that are incomplete, damaged, missing, or not operating properly. These should be noted on the PDI form provided by your builder. The PDI should be thorough and not rushed – it's your opportunity to verify the home's condition prior to moving in. Noting any problems now may help eliminate disagreements at a later date if there is a dispute about who is responsible for any damage. Tarion's PDI guide and checklist, available at www.tarion.com, will help you prepare.
Warranty Coverage Every new home built in Ontario comes with warranty coverage that is provided by the builder and backed by Tarion. In addition to deposit coverage, home buyers may be entitled to compensation for a delay in closing if proper notice has not been given. Coverage is also provided for unauthorized substitutions of items agreed to in the purchase agreement, defects in the electrical, plumbing and heating systems, issues with water penetration, violations of the Ontario building code and more.
More information is available online at www.tarion.com.
Word count: 551
Attention Editors: Please note that this article is for use in Ontario only.
Articles are provided free of charge. Articles appearing on web sites, must credit www.newscanada.com. Articles appearing in Print, must credit News Canada with (NC) at beginning of an article or – News Canada at the end. Any source/sponsor of the information quoted in the text must also be identified as presented. Images are only to be used with corresponding editorial copy. Usage of News Canada articles constitutes your acceptance of these terms and an agreement between you and News Canada.
Image Instructions - Note: Illegal to use without News Canada editorial.
To open/download image(s) used in this article, please click the following links:Click here for image file: «76628H.jpg»