A Status Certificate is a report on the current status of a condominium corporation.
Who Can Order Status Certificate and How to order
A Status Certificate can be ordered by anyone who is related or not related to the condominium corporation or a unit of it. To order a Status Certificate, you need provide:
- a written request for a Status Certificate for a particular unit, and
- payment of $100.00 (including taxes).
Within 10 days upon your written request and payment are made, the condominium management shall have the Status Certificate available for you with all the usual accompanying documents (collectively called "Status Certificate package"). Generally, a Status Certificate is order by the seller for the purchaser of particular condominium unit.
Content of Status Certificate
The Status Certificate provides valuable information directly from the condominium corporation, examples of such information include, but are not limited to:
- The management structure of the condominium corporation
- The legal description of the unit(s) in concern;
- The amount of monthly common expenses, and arrears and extra charges, if any;
- The budget and any increases in common expenses or special assessment levied since the date of budget and the knowledge of any circumstances that may result in an increase in the common expenses for the particular unit during the budget period;
- The amount of the reserve fund and whether the reserved fund is sufficient for any major work in the condominium, the reserve fund study, any reasons and any plans to increase the reserve fund according to the reserve fund study
- Information about any legal proceedings and claims against the condominium corporation;
- Permission for any alternation to the common element given to the unit owner or not.
- Substantial changes to be done to the common element, assets or services of the condominium;
- Number of unit leased in the condominium and insurance policy being placed or not;
- List of documents attached to the Status Certificate, the right to get copies of all current agreements to which the condominium corporation is a party by the person ordering the Status Certificate.
Content of Status Certificate Package
The Status Certificate Package usually includes the following documents for the condominium corporation:
- Declaration, by-laws and rules;
- Budget and financial statement;
- List of agreement to which condominium corporation is a party;
- Declaration, by-laws and rules;
- Insurance certificate;
- Summary of Reserve fund study and proposed plan for future funding, etc.
Why a Status Certificate shall be Ordered and Reviewed
When you purchase a condominium unit, you have at least the following concerns:
- The quality of condominium management, which affects your daily life.
- The on-going costs - the amount of monthly common element fees and, if any, the special assessment.
- The re-sale value of your property in the market when you sale it.
The contents must be included in the Status Certificate is defined by the law, for the purpose of providing general and important information for purchaser's above concerns. With the need of knowing the condominium unit before you decide to purchase, it is necessary for a purchaser to have an updated Status Certificate reviewed.
To protect the interest of the purchaser, it is the general practice to have a condition for reviewing Status Certificate drafted in your agreement of purchase and sale. Even if you do not have such a condition in your agreement, you still have to order one since your mortgage lender and your title insurance company will require an updated Status Certificate before the mortgage fund can be advanced and title insurance policy can be issued. In some cases, the title insurance policy is issued, the title insurance company will not provide you a full insurance protection for not having an updated Status Certificate. Updated Status Certificate is generally defined as that the date of Status Certificate is issued within 60 days before the closing date.
In most cases, the Status Certificate is ordered and paid by the vendor and then provided to the purchaser. Not having an updated Status Certificate happens in the following situations:
- To save money or for other purpose, a few vendors provide a Status Certificate they received before which, in most case, not a updated one;
- The closing date is two months more after the date for agreement of purchase and sale and the deadline for reviewing Status Certificate.
To protect the purchaser, you shall make sure the Status Certificate received from the vendor is newly ordered; In case of a closing is more than two months later, you shall order an updated one before closing - spend a $100 extra to get a full protection from title insurance company.