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Here we break down everything you need to know about a status certificate.
A status certificate is a document that provides a thorough overview of the financial, legal, and operational condition of a condominium corporation. It is an essential resource for buyers evaluating the health of a condominium unit and its associated corporation. The document is usually prepared by the condominium corporation’s Board of Directors with contributions from the property management company.
The status certificate specifies the legal description of the unit, including details about any lockers or parking spaces associated with it. This ensures clarity about the assets the condominium owner holds and transfers during the sale.
Included in the status certificate are financial records, such as the corporation’s budget, audits, and the reserve fund study. The reserve fund study, generally updated every three years, provides a schedule of repair and replacement projects. These reports highlight the corporation’s long-term financial planning.
The document outlines the monthly maintenance fees charged to unit owners and specifies what these fees cover, such as utilities or shared amenities. Additionally, it confirms if the current unit owner owes any outstanding fees to the corporation.
The status certificate details the building’s insurance coverage and includes information about any special assessments. Special assessments refer to additional fees charged to owners for expenses that exceed the usual budget, such as unexpected repairs.
Any existing or pending legal actions involving the condominium corporation, such as lawsuits or creditor claims, are disclosed in the status certificate. These issues could create future liabilities for potential buyers.
The status certificate includes regulatory documents like the declaration, by-laws, and condominium rules, which explain governance and owner restrictions. It also describes the property management’s role and the terms of their contract.
In some cases, the status certificate provides minutes from the latest annual general meeting. These records allow buyers to gain insight into recent board decisions and concerns raised by owners.
Buyers, sellers, and third parties can request a status certificate. A written request and a fee—commonly around $100 plus taxes—are required. The condominium corporation must provide the certificate within 10 days. Expedited delivery may be available for an additional fee.
Buyers often share the certificate with their attorney for review. This process, typically completed within two to three days, helps identify potential risks or inaccuracies in the document. Legal review protects buyers from unforeseen liabilities.
The creation and content of a status certificate are regulated under provincial condominium laws in Canada. For example, in Ontario, the document falls under Section 76 of the Ontario Condominium Act, with comparable standards enforced in other provinces to promote transparency in condominium sales.
