What Undivided Co-ownership means

In your search for condos, you might have come across the term Co-propriété Indivise, or Undivided Co-ownership. In other provinces are referred to Co-op, but not here in Quebec. In this province, co-op means Housing Cooperatives; used for regulating housing fees and expenses, mostly rental properties. Since we are talking about purchasing real estate here, let’s stick with the two terminologies: Undivided co-ownership or Co-propriété Indivise.

What is Undivided Co-ownership?

According to La chambre de Notaires du Quebec:

A property of this type belongs to several individuals, called undivided co-owners. No one owner owns an exclusive portion of the property; rather, they each own a fraction.
For example, you buy a triplex with two of your friends and you all contribute equally to the sale price. After the sale, you decide to move into the second-floor apartment. The apartment does not belong to you exclusively; your two friends share its ownership with you, just as you share the ownership of their dwellings on the first and third floors. You and your friends are undivided co-owners of the whole triplex. In the example above, your shares in the immovable are one third each.

In a nutshell: When you buy into an undivided co-ownership you are acquiring shares into the ownership of the building, as an undivided co-owner.

Condominiums are divided by cadastral numbers, each unit has their own, sort of like a serial number for properties. When buying into a condominium, you are buying real estate property. While with undivided, the building has only one cadastral number (wheather it has 40 units or 2), and the undivided owners share the title of ownership to the whole building, with the exclusive rights to the units dictated on the indivision agreement.

In terms of property prices, we cannot say that condos are more expensive than undivided co-ownerships. The search results of condos sold in Plateau (2 bedrooms, 1 bath, 800-1000 sq ft) in the last six months gives us a median of $250,500. While with the same criteria, the undivided shows a median price of $244,000.

Undivided units are in buildings of different styles, sizes and in every type of neighborhood. We’ve noticed a great number of these properties popping up in Plateau, Downtown, NDG and Côte-des-Neiges. Also Westmount, Villeray and Rosemont are following up in listing numbers.

In a future article, we’ll write about Financing and shared costs of these types of properties. Stay tuned!

Subscribe to the Montreal Real Estate Blog

A list of Real Estate Abbreviations: Residential

Even though these days we are getting more descriptive Property Information Sheets, there can be times when you’ll run into an almost illegible document. These property sheets were often described with a lot of abbreviations. Trying to decipher its meaning is almost as hard as finding a good property!

Here is a bilingual list of Real Estate abbreviations used to describe residential properties.

Click on this link to view the PDF file: Abbreviations List
(You can save a copy or print)

Why Deal with a Mortgage Broker?

Brokers search for the best lender package to suit your specific financial situation, whether it’s with a Chartered Bank, Trust or Insurance Company. There is a wide variety of options and features available to homebuyers today. To find the best offer takes a lot of time and effort. The mortgage process within today’s very competitive marketplace makes many Canadian homebuyers puzzled. It truly pays to work with a mortgage professional that will represent you and ensure the mortgage you get is the one best tailored to your needs.

NOTE: Choosing the wrong mortgage can cost you thousands of unnecessary paid interest money.

Why Should You Go To a Mortgage Broker First?

A professional presentation to a lender on the first application will get the best response and save you valuable time and money. Secondary applications with previous credit bureau inquiries may be more costly.
Often the success of obtaining mortgage approval depends on the way a proposal is presented and to whom it is sent. Your Mortgage Broker is trained to present your mortgage proposal to obtain the most immediate and positive result.

Example: You don’t call an insurance company for insurance - you use an insurance broker, because of their expertise, product knowledge and rates. So remember, call your mortgage broker first!

How Do Brokers Get Better Deals Than Many Banks?

Brokers often develop professional relationships with private sources of funds, termed private lenders. These lenders can provide many various mortgage products not available at conventional sources.

Can You Still Go Through Your Bank With Your Broker?

Yes, letting a Mortgage Broker represent you to your own financial institution can often result in a better rate than you could get on your own.

Written by Danuta Levitzki. Conseillère en Financement Hypothécaire | Mortgage Loan Specialist
For current interest rates or to get more information on mortgage financing feel free to visit her website or call direct at 1-800-605-6154.

Need a mortgage?

1. Let us help you find the best mortgage rate for you.
2. Your Name(required)
3. Email(valid email required)
4. Telephone(required)
5. Best time to call Contact me during the day Contact me in the evening

 

cforms contact form by delicious:days

Buying a New Condo: The Pros and Cons

You can buy a new condo from the developer before or during its construction and also before the condo corporation is formed. A developer may have some unsold units available after the condominium has been completed and registered.

In some markets, the developer may wait to sell a large percentage of the units before registering the condo corporation or even starting construction.

Usually, a deposit is required to secure or reserve, a condo unit in a new development.

Buying a new condo. The Good Side:

• New home warranty protection. (Up to five years)
• You have more choice of locations within the building; floor level, different views, etc.
• Customized design (in some cases); more options and upgrades to choose from.
• Newer buildings have less risk of having to undergo costly repairs and renovations.
• The purchase price could be lower than resale market condos. Especially in pre-sale phase of the construction.

Buying a new condo. The Bad Side:

• If the constructions have not started, you cannot physically see what you are buying and have to rely on floor plans and sketches that are subject to change.
• Your initial deposit will be locked up for the duration of construction.
• Some banks may refuse to give you a mortgage if the condo corporation has not been registered.
• The construction of the units may not be completed by the expected date. And the delivery date can be a lot later than originally agreed.
• It’s possible that you may move into your unit while construction continues in others.
• Last but not least; More taxes. New constructions have to pay GST and QST. (Not the same as the Land Transfer Tax) But, the good news is: you might be eligible for a housing rebate.

So there you have it. The choice is yours.

Still want to buy a new condo? Send us an email. Perhaps we can help you.

Need more info before buying? Subscribe to the Montreal Real Estate Blog

How to repossess your income property

You found an income property you like.

The place is perfect for you; great location, in fantastic condition. It’s fully rented with good paying tenants in long term leases. The revenues are good enough to cover all the expenses; including your own part of the mortgage….Because, after all, you are buying the place to move in. Right?

Living rent free, what a dream!

But wait a minute. Isn’t the building fully rented?

“Yes, but as the new owner, I can take back one of the units whenever I decide to” - You might be thinking.

Well, it doesn’t really work that way. You see, according to the Régie du logement:

“All tenants have the right to remain in the rental unit indefinitely as long as they respect the terms of the lease…”

How can you repossess one of the units, if there’s no problem with the terms?
Do you have to wait until someone decides to leave in order to move in?

Fortunately, the law also mentions…

“(However) the landlord may terminate the lease under certain circumstances.”

Now, that’s interesting >>

What’s included in your Condo fees?

Condo owners pay a monthly fee to cover their portion of the operating expenses of the common property elements. A portion of this fee is assigned to the reserve fund.

The calculation of condo fees varies by province but is usually specified in the governing documents of the condo corporation. These fees are usually calculated from the annual operating cost of the entire condominium and divided by the percentage of your contribution to the common expenses (your unit factor) as outlined in the condominium governing documents and/or local legislation.
These fees may include:

• Day-to-day care and upkeep of the common property elements (e.g. snow removal, landscaping, cleaning of common elements including carpets and exterior windows, heating/cooling system maintenance)
• Contributions to the reserve fund, which is used to pay for major repairs to, and replacement of, common building systems to ensure the condominium is kept in good repair over the life of the building

[Read more]

How do you know if a condominium is in good financial condition?

The financial well being of the condominium corporation is an important consideration. Buying on into a condominium corporation that is insufficiently funded to operate and maintain common elements is a risky proposition.

Low condo fees may make one condo more appealing than the others, but it may also be a sign that the condo corporation is not-prepared to fund major repairs and renewal projects. As a result, the condition of the property can deteriorate or you may be faced with substantial charges from the condo to cover repair costs as they occur.

Fortunately there are way to determine the financial status of the condominium, based on the documentation that the condo corporation is obliged to keep, such as annual operating budgets and end-of-year financial statements. An important part of the operating budget is the reserve or contingency fund.

The Reserve Fund

The purpose of a reserve fund is to provide financing for major repairs and renewal projects over the life of a condominium building. The fund essentially ensures that the common elements will be maintained in good shape for the life of the project. The amount required to be in the reserve fund depends upon the condition and life expectancy of all common elements in the building and the estimated costs to replace them over the life of the project. [Read more]

Making an Offer to Purchase

Once you have found the home you would like to purchase, you need to present the vendor with an Offer to Purchase or an Agreement of Purchase and Sale. As your home is probably your biggest investment, it would be wise to work with your real estate agent and/or a lawyer/notary in preparing your offer. Remember that the Offer to Purchase or Agreement of Purchase and Sale is a legal document and should be carefully prepared.

Any offer or agreement will typically include:

• Your legal name, the name of the vendor and the legal civic address of the property.
• The purchase price offered.
• The chattels that will be included in the purchase price (e.g.: window coverings, appliances or a satellite dish). Whatever items in or around the home that you think are included in the sale should be specifically stated in your offer.
• The amount of deposit.
• The closing day (date you take possession of the home)–usually 30 to 60 days from the date of agreement. It can also be 90 days or longer.
• Request for a current land survey of the property.
• Date when the offer becomes null and void.
• Any other conditions that go with the offer, including property inspection and approval of mortgage financing.

The process of making an offer, receiving a counteroffer and then revising it again is not uncommon. The whole process can seem like a roller coaster ride – exciting, but stressful. It’s all part of making the deal work best for you and the vendor.

Source: CMHC. Subscribe to the Montreal Real Estate Blog

Pre-approval: what it really means

Early on and even before you start home shopping , you need to determine the price range that suits you. If you plan to finance your purchase with a mortgage loan, sit down with your lender or mortgage specialist to discuss your needs and get mortgage pre-approval. That way, you know exactly how much you can spend on your new home.

• Pre-approval means that your lender commits to giving you a mortgage loan up to a specified amount at certain terms and conditions, including the interest rate.
• Pre-approval are only valid for a specific period.
• Pre-approval doesn’t lock you into the mortgage. You are still free to pursue other arrangements, including getting a mortgage loan through another bank instead.

The benefits of having a pre approval letter with you before starting the home hunting are numerous since it gives you advantage over those home shoppers who have no clue on what their factual financial limitations are.

[Read more]

Buying with zero cash down. Is it really possible?

The first time you see the ad Scotia Bank 100% Mortgage Program, you may ask yourself…What’s the catch?
Perhaps Scotia Bank still requires the 20% down, but gives you the option of a line of credit?
OR…they really offer to finance you 100% BUT with rates a lot higher than the regular mortgages?

Something to ponder about.

The real answer is none of the above and it was confirmed this afternoon, after speaking with a mortgage specialist Nadine Emony from the Scotia Bank who informed me that the only thing needed in order to be eligible for a 100% Mortgage is to have very-good credit.

Not bad, uh?

In addition to that, you need to:

· Have a min of 2 years of good credit history with one of the major credit cards: Visa and/or Mastercard.
· Have a steady job.

There probably are a few more requirements to be eligible for a 100% mortgage, but for the most part, these are the two most important factors.

Information and link was kindly provided by Mortgage Specialist Nadine Emony. Visit her page for more details.

Next Page »