Sometimes consumers are not fully aware of what they are getting into when purchasing a pre-construction condominium. More often than not, it’s the experts that have failed to give all of the information in great detail. Without educating the consumer they can make a wrong decision that will cost them a lot of stress and money.
Here’s a scenario: The buyer decided three weeks before closing to that they were not going to use the same real estate lawyer or lender for the closing that they had used for the original purchase of two pre-construction condominium units. This turned out to be a very good thing as the buyer was not provided the right information from all parties involved from the very start.
This lawyer whom I had worked with on numerous occasions over the years contacted both myself and a lender that is part of our team. It was discovered that the buyer should never had purchased the two units! They did not qualify a few years ago, and they did not qualify now to get two mortgages! One would have to go on the market right away and the other they could keep for investment. The problem was that both units were closing in 3 weeks!
The buyer had to pay the builder almost $5,000 for the assignment sale. Plus, because the other unit that they were keeping was going to be an investment property they had to pay back the HST which deducted from the original purchase price of nearly $24,000 on closing!
I scheduled the professional photography for unit the following day of our meeting. The unit sold as an assignment sale within a week. It’s critical to get all of the clauses and payment structures worked out so that the original owner would now have the funds to close the second unit.
With one unit sold and the second unit kept as an investment, this unit had to be leased as quickly as possible. It was leased within a few days.
The client sent me a wonderful testimonial stating how quickly and expertly the work was done.
This incident should never have happened in the first place. Working with the right people that will educate you so that you can make an informed decision and not have to deal with the unnecessary stress.
Need professional advice? I only work with lenders and real estate lawyers that have a proven track record with both my past and existing clients. Constantly asking for feedback from my clients ensures me that they are provided with excellent customer service and advice.