Defects Hidden from the Buyers
Almost all agreements of purchase and sale include a buyers’ right to inspect the property. If the seller makes false representations about the property, the buyer may be able to bring a claim against the seller for any losses they incurred from the defects. This almost always includes the costs associated with fixing the defects, including, but not limited to, the costs of materials, the labor costs, and even costs associated with a decrease in the value of the property.
Failure to Complete the Agreement of Purchase and Sale
This usually occurs because the buyer was not able to secure the required funds by the closing date stipulated on the agreement of purchase and sale. One of the reasons why the buyer might have not had the funds is because they failed to secure mortgage financing from a bank or private lending company.
Another reason could be that the buyer was anticipating to receive money from another sale, which had not arrived on time. In this case there are many two main situations that can occur. The seller may choose to take the buyers’ deposit. Or the seller can also pursue the buyer for any losses they would have sustained in re-selling the property.
These include, but are not limited to, a reduction in sale price, new closing costs and legal fees associated with the transaction. Another reason the agreement of purchase and sale may fail us because the sellers were unable to close. Sometimes, the sellers may not have been able to complete the repairs they promised to have fixed.
Other times, the sellers may not have been able provide a clean title due to undisclosed mortgages or liens. In such cases, the buyer can claim damages for any losses in being unable to purchase the property. In severe cases, a court order can be obtained to enforce the performance of the agreement of purchase of sale.
Rent to Own Agreements
These kinds of agreements are becoming more popular amongst buyers across Ontario. Specifically, these agreements provide renters with the opportunity to invest in the future of the property of which they are currently renting. It is also important to note that in these agreements, a portion of the rent paid will usually contribute to the down payment of the property. However, disputes can arise when a tenant seeks to exercise the purchase option, but the current purchase price has greatly exceeded the price stipulated in the agreement. Therefore, the seller will be losing out on a large sum of money. For tenants, a lawyer can assist in ensuring that the option agreement is properly exercised. For owners, a lawyer can assist in assessing whether or not the option agreement is correct, and therefore try to maintain the ownership of the property.
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