Amortization period: This is the number of years you have to pay off your mortgage. The longer the period, the lower your payments. However, Canadian buyers are not able to sign up for amortization periods longer than 25 years if they put less than 20 per cent down.
Pre-construction building: Buying a pre-construction unit means that since the building hasn’t been completed (it might only be a hole in the ground and a twinkle in a developer’s eye), you’ll be basing your decision on a model suite and a floor plan.
Condo board: Condo boards are made up of building residents who represent the interests of everyone living there. The board meets regularly to make all the major decisions regarding the maintenance and finances of the building.
Condo Act: This is a piece of provincial legislation that lays out how condos should be purchased, run, lived in, and so on. But since the act isn’t enforced, condo owners must take it upon themselves to learn the law and make sure their board complies with it.
Reserve Fund: Every board is required to keep a pool of money used to make repairs to the building’s structure and common areas. A portion of your maintenance fees go towards the reserve fund.
Status Certificate: A report that outlines the state of the condo. It includes information such as what work is being done to the building, the amount of money in the reserve fund, any claims against the condo, and financial statements. Offers on condo units are often conditional upon a lawyer reviewing the building’s status certificate.
Equity: In real estate, this is the difference between the market value of a property and how much the owner owes on the mortgage. So, if you were to sell your home for $400,000, but still had $100,000 on the mortgage, your equity would be $300,000.
