- Offer to purchase (promise to purchase) : Offer to purchase (promise to purchase)
Definition : Offer to purchase (promise to purchase)
Prior contract by which a promisor-buyer undertakes to acquire a property at a price, conditions and within a specified period, and this, without having the guarantee that the owner of the building will accept it. The offer to purchase (or "promise to purchase"), once accepted by the owner, is the first step that leads to the deed of sale (or purchase, depending on the point of view).
The offer to purchase usually indicates a period during which the seller can accept or refuse it. It is essential to attach a period of acceptance and notification to the offer to purchase. This period is equivalent to the period of time during which this offer to purchase will remain valid. The seller can then accept or refuse it. Failing to include this period in the offer to purchase, the Civil Code of Quebec provides that it will lapse on the expiry of a reasonable time. In addition, the offer to purchase may include suspensive conditions for which it will be necessary to determine a deadline for completion. This type of condition makes it possible to suspend the validity of the offer to purchase until the realization of a future and uncertain event that it foresees, for example the obtaining of mortgage financing. These suspensive conditions must provide for sufficient time, so that the promisor buyer has an adequate reaction time before they expire.
L'article 1068.1 du Code civil du Québec obligera, issu du projet de loi 16, obligera une plus grande transparence lors d'une transaction en copropriété. Le document d'attestation prévu dans cet article posera des questions pointues sur "l'état de la copropriété", afin que les acheteurs sortent du brouillard avant d'acquérir un appartement détenu en copropriété divise.
27 mai 2021 — La ministre des Affaires municipales et de l’Habitation (MAMH), Andrée Laforest, a récemment lancé une vaste consultation visant l’adoption de sept dispositions prévues dans le projet de loi 16. Celui-ci a été sanctionné en janvier 2020.
In undivided co-ownership, the rights of withdrawal and of first refusal may disrupt the course of a real estate transaction. It is important to know that other co-owners may take precedence over a potential purchaser. The title of the latter could be precarious for some time: a buyer who acquires rights in an undivided co-ownership without first receiving the approval of all the undivided co-owners is therefore liable to have his share redeemed and thus be excluded from the indivision.
After months of searching, you have found an apartment completely renovated and decorated with great taste. Finally, you will buy the property of your dreams with training room, roof terrace, swimming pool and indoor parking. You certainly know that making the leap can be both an exciting and complex step. Only it is a divided co-ownership apartment. That is why, at the time of submitting the offer to purchase, a doubt intrudes into your heart. All kinds of questions intertwine in your mind:
Buying an apartment in a co-ownership is a major investment in a lifetime. To avoid being caught off guard during the process leading to your purchase, you should seek proper assistance.
Section 1719 of the Civil code of Québec states that the seller must provide the buyer with a copy of the deed of purchase, as well as with a copy of the owner history and of the certificate of location he has on hand. Prepared by a land surveyor, the certificate of location is part of the property titles the seller must supply.
In the interest of the buyer, the certificate of location should clearly describe the current condition of all private portions (for instance, an apartment, a parking or storage space, or even land). Should the seller not have a certificate of location on hand (and unless the promise to purchase states otherwise), they will need to have one prepared, at their own expense.
The intervention of the notary is very important when purchasing an apartment in a divided co-ownership. A professional, member of the “Chambre des notaires du Québec” (Québec Chamber of Notaries), he is also a public officer. As such, the notary has without limitation the mission of executing deeds to which the parties wish or are required to endow with authenticity (such as a declaration of co-ownership). Even though it is preferable that he should get involved at the outset of a transaction, this legal adviser usually gets involved after the signing of the offer to purchase or of the preliminary contract.
The notary, in his capacity of public officer:
Warrants the validity of the deed of sale;
Is bound to act objectively and to give legal advice to all the parties (equally to the purchaser and the vendor);
Is bound to a duty of information to the parties, which means he should give the parties relevant advice and information in relation with the deeds signed before him.
Once the apartment of your dreams in your price range found, the next step is to make an offer to purchase, either verbally or in writing. Although the verbal option is legally valid, it is better to formalize it in writing. L’Organisme d’autoréglementation du courtage immobilier du Québec (OACIQ) (the Quebec Organization for the Self-Regulation of Real Estate Brokerage) imposes a rule of ethics, namely that all acting real estate brokers must record in writing the intention of the parties to enter into real estate transaction.
At the time of concluding the offer to purchase, it is customary for the promising buyer to pay a deposit or security deposit of a variable amount. The amount thus paid will be deducted from the amount to be paid if the sale is concluded and will be remitted to the seller. Although a buyer is not legally required to pay a deposit, this practice offers the seller an additional guarantee as to his true intention to buy and his apparent solvency. All in all, this financial effort provided by the buyer is intended to dissuade him from abandoning his project in an irregular manner.