Thursday, April 5, 2012
Real Estate 101
The importance of knowing what you are buying: So yesterday I am sitting in a classroom of real estate representatives all looking for the same common ground. To further or update their education and fulfill the credit requirements governed by the Real Estate Council of Ontario. One question that came up from the administrator of the class was "how many people in the room write down the serial number of the appliances that are included with the sale of the home on the buyers offer?" I immediately put my hand up, and looked around the room in amazement. I was the only one! Did you know if on an Agreement of Purchase and Sale, the included Chattels read something like this [ fridge, stove, washer, dryer] then that is what you are getting? It doesn't say what fridge or stove, it just says fridge or stove. Now the Seller can legally turn around and replace those newer stainless appliances with some Thrift Store specials! or if the original stove breaks before closing, he can just replace it with something found at a garage sale, provided it is working. This is why it is important to at the very least have a description of the appliances such as "White Maytag two door fridge" as seen on January 4, 2012 (showing time). Chattel Warranty ON many agreement of purchase and sale forms you will likely see a clause that reads something like this : The Seller warrants that the chattels as included shall be in good working order and free from all leins, encombrances and defects. this warranty shall survive and not merge on closing but apply only to the state of the property on closing.... Most people scratch their heads at this and wonder what it means...well in a nutshell it means that as a buyer, you are being told that the appliances are in good working order and that on closing they will be. If on the day of closing you go in and something isnt working, then you have a day or two to notify your lawyer and hopefully it will be fixed or replaced. Basically it gives you a reasonable amount of time to make a claim as the courts know that the day of moving in is hectic and maybe you didn't get a chance to call anyone because the deal didn't close until 6pm etc. However, if after 3 days, something breaks, well....Caveat Emptor (let the Buyer Beware) I always tell my client whether a buyer or seller the following : I don't sell appliances, I sell homes. You pay me to negotiate the best deal for you and in that negotiation it may include appliances. Remember that the Seller is not an after market warranty company, and over a used $400 appliance, you are likely going to pay as much in legal fees to try and recover that. Bottom line is, make sure it is spelled out on the offer "exactly" what you want.