Due to the recent rises in interest rates, those who have purchased new condo units will receive interest on their deposits. The prescribed interest rate is lai
Thomas
Due to the recent rises in interest rates, those who have purchased new condo units will receive interest on their deposits. The prescribed interest rate is laid out in Section 82 (1) of the Condominium Act, and states that:
Between April 1st and September 30th of any given year, the rate is set at 2% per annum below the bank interest rate established by the Bank of Canada
Between October 1st of any given year and March 31st of the following year, the rate is set at 2% below the bank rate on September 30th of the first year
In normal circumstances, interest at the prescribed rate is due upon the commencement of interim occupancy. For example, if a condo was purchased on January 1st, 2022 and interim occupancy date is March 1st, 2024 then interest would be calculated from January 1st, 2023 to March 1st, 2024. If interest on interim closing is not paid, however, it will continue to accumulate interest at the prescribed rate until final closing. This has the effect of potentially increasing the amount owed to the purchaser.
Have questions?
Want to know more about Condominium Interest Rates? Send me a message and I'll get back to you within 24 hours.
