Toronto Interim Closing Lawyer
Interim Closing for Pre-Construction Condos: What Every GTA Buyer Needs to Know
When you purchase a pre-construction condo in Ontario, the closing process happens in two stages: the interim closing (also called the occupancy closing) and the final closing. The interim closing occurs when the building is substantially complete and you can move in—but the unit is not yet legally registered as a condominium. This means you occupy the unit as a tenant under a lease-style arrangement, paying occupancy fees instead of mortgage payments, until final closing.
At Sarkaria Sethi LLP, we guide pre-construction buyers through every aspect of the interim closing process, ensuring you understand your rights, your obligations, and what to expect during this transitional period.
Understanding the Interim Closing Process
When Does Interim Closing Happen?
The interim closing occurs after the builder has obtained an occupancy permit from the municipality but before the condominium corporation is registered with the Ontario government. This period can last anywhere from a few months to over a year, depending on how quickly the builder completes the entire project and registers the condominium.
Occupancy Fees Explained
During the interim period, you pay occupancy fees to the builder rather than a mortgage to a lender. These fees typically cover three components: the projected property taxes for the unit, the projected common element condominium fees, and an interest component calculated on the unpaid balance of the purchase price. Your lawyer reviews the builder’s occupancy fee calculation to ensure it complies with the Ontario Condominium Act and your Agreement of Purchase and Sale.
Your Rights During Interim Occupancy
While you are in occupancy, you have the right to quiet enjoyment of your unit, but the builder retains ownership until final closing. The builder is responsible for completing any outstanding work, and your lawyer can help enforce these obligations if the builder delays or performs substandard work. Any damage to your unit or common elements during this period should be documented and brought to your lawyer’s attention.
How We Help with Interim Closings
- Review the builder’s occupancy fee calculation for accuracy and compliance
- Coordinate with the builder’s lawyer on the interim closing documents
- Advise on your rights and obligations during the occupancy period
- Monitor progress toward final closing and condominium registration
- Prepare for the final closing, including title transfer and mortgage registration
Transitioning from Interim to Final Closing
The final closing occurs when the builder registers the condominium corporation and each unit’s deed. At this point, your ownership is formally registered with the Land Registry System, your mortgage funds are advanced, and the occupancy period ends. We coordinate with your lender, the builder’s lawyer, and the land registry office to ensure a smooth transition from interim occupant to registered owner.
Frequently Asked Questions
Can I negotiate occupancy fees?
Occupancy fees are calculated based on formulas set out in the Condominium Act and the terms of your Agreement of Purchase and Sale. While there is limited room for negotiation, we review the builder’s calculation to ensure it is accurate and compliant.
What happens if the building is not registered by the estimated closing date?
Delays in condominium registration are common in the GTA. Your Agreement of Purchase and Sale should specify your rights if registration is delayed. Some agreements allow you to terminate the agreement after a specified period; others simply extend the interim period. We review these terms with you before you sign.
Get a Free Legal Consultation
Facing an interim closing or considering a pre-construction purchase? Contact Sarkaria Sethi LLP for a free consultation. Call 905-440-1220 or reach out online. We serve clients in English, Hindi, and Punjabi.
Legal Information, Not Legal Advice. This page provides general information about real estate legal services in Ontario. Every real estate transaction is unique, and you should consult with a qualified real estate lawyer about your specific situation before taking any action.