How are you protected if your new home is not ready on time?

Building a brand new home is an exciting venture!  It’s fun to be able to choose a lot, customize a layout and pick out colours and finishes.

As a Buyer, your Realtor will be able to help you understand the Builder’s contract and advise you on the appropriate conditions that should be included to protect you.

An important feature of the Builders’ contract is the Tarion Home Warranty Addendum, which includes the accompanying Statement of Critical Dates. This addendum contains important provisions that are part of the Delayed Closing Warranty provided by the registered Builder in accordance with the Ontario New Home Warranties Plan Act.

CRITICAL DATES

FIRM CLOSING DATE: The Builder will set a Firm Closing Date.  This is the date that the house will be completed and ready to occupy. The Builder is required to take all reasonable steps to complete the construction of the home and close on this date. If the Builder cannot have your home ready by this firm closing date you may be entitled to compensation.
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DELAYED CLOSING DATE:  If the Builder is unable to complete your home by the Firm Closing Date he/she will set a Delayed Closing Date.  And as the Buyer you will be entitled to compensation up to a total of $7500.  However, if the Firm Closing Date is changed by mutual consent (Amendment to the Agreement of Purchase and Sale), you will not be entitled to compensation.  As well, if the builder is unable to complete construction due to an unavoidable delay, there will be no compensation due.

OUTSIDE CLOSING DATE: The Builder may set a Delayed Closing Date up to 365 days after the Firm Closing Date. This is referred to as the Outside Closing Date.  If the your home is not completed by this Outside Closing Date, then you can terminate the transaction within a 30 day period thereafter. If you terminate the transaction you will be entitled to delayed closing compensation and to a full refund of monies paid plus interest.

It is strongly recommended that as a Buyer you seek advice from a lawyer with respect to the Builder’s contract and associated addendums before firming up any purchase agreement.

Please contact me if you have any further questions concerning ‘Critical Dates’ or the Tarion Home Warranty in general. I would be happy to help.