What Is An Assignment?
An assignment is essentially a sale of a contract or right to acquire property. An assignment is a transaction whereby the original purchaser (the "Assignor") of a property sells, and thereby transfers, their interest and obligations under the original contract to a new purchaser (the "Assignee"). The Assignee will generally assume all of the Assignor's duties and obligations under the original Agreement of Purchase and Sale. These rights and obligations are stated in the original Agreement of Purchase and Sale and include terms such as interest payments, taxes and maintenance fees during interim occupancy. Upon completion, the Assignee is granted the title to the real property and will incur all final closing costs.
a) Assignor: An Assignor is the original buyer of the unit from the Builder/Developer.
b) Assignee: An Assignee is the buyer of the Agreement of Purchase and Sale from the Assignor.
Is an assignment legal?
An assignment is legally permitted unless otherwise expressly prohibited in writing in the original Agreement of Purchase and Sale. An assignment fee may be charged by the developer and is normally a cost borne by the Assignor (the original purchaser).
You need to consult the Agreement of Purchase and Sale. Generally, Developers will not permit assignments without the Developer’s consent, therefore every situation requires consultation with the Developer and your lawyer. Please note, there have been incidents where an unauthorized assignment has resulted in termination of the original agreement and the withholding of the deposit.
In the event of a delay, the assignment is still valid: the Assignee has agreed to take on their agreement and all responsibilities involved in it.
It is essential that the Assignor and Assignee each retain a lawyer with expertise in this area of real estate
If the Developer consents to an assignment, there will generally be an administration fee and legal fees. These fees will vary. Consult the original Agreement of Purchase and Sale and the Developer.
SUCCESSFUL ASSIGNMENTS' TRANSACTIONS CAN SAVE BOTH BUYER (ASSIGNEE) AND SELLER(ASSIGNOR) LOTS OF $$$ AND I HAVE NEW ASSIGNMENT LISTINGS COMING UP TO THE MARKET EVERY WEEK,PLEASE CONTACT ME FOR MORE INFORMATION.
Condominium Assignment Basic Guidelines
For Assignor
1. Is the original Agreement of Purchase and
Sale assignable?
2. Are there any restrictions on marketing the
Assignment?
MLS® ,Exclusive, or Privately
3. The Builder may require the Assignor and Assignee to sign the Builder’s consent form or the
Builder’s Assignment Agreement.
The Assignee may be required to prove that they can obtain a mortgage.
4. The Assignor usually agrees to obtain Builder consent and pay consent fee (may be the
Assignee).
5. The Assignee may be required to pay the Assignor an amount equal to the deposits (and possibly
the interest on the deposits) already paid to the Builder at time of occupancy.
6. Provide the Assignee with original Agreement of Purchase and Sale and all related documents.
7. The Assignor is not usually released from their obligation to the Builder if the Assignee does
not complete the purchase.
8. The Assignor is responsible for the following costs:
legal fees and disbursements
builder consent fees
Real Estate commission.
For Assignee
1. Enter into an Assignment Agreement.
2. Obtain original Agreement of Purchase and Sale and related documents. Review obligations carefully. Have a lawyer review.
3. The Assignee may pay the following on occupancy:
a. Final deposit
b. Occupancy fees:
i. Estimated property taxes
ii. Estimated common expenses
iii. Interest on purchase price.
The Assignee usually delivers 6-12 postdated cheques to the Builder.
4. The Assignee may pay the following to the Builder on final closing:
a. Estimated property taxes for up to 2 years
b. Hydro/water/gas meter installation and connection charges (approx. $500–$700 per meter)
c. Development charges/levies (potentially thousands of dollars)
d. Tarion New Home Warranty (ranging from $600–$1,900. See Tarion website for fee structure)
e. Discharge of builder’s mortgages (approx. $200–$300 per mortgage)
f. Builder’s lawyer’s Law Society charge (approx. $70)
g. Compensation for the Builder–cost of handling the Assignor’s deposit cheques (approx. $250)
h. 2 months of occupancy fees for reserve fund
i. Other amounts set out in the Agreement of Purchase and Sale.
These costs are typically not financed with a mortgage.
5. The Assignee is responsible for the following additional fees:
a) Legal fees and disbursements
b) Land transfer tax (provincial and municipal).
c) GST/HST rebate.
d) Municipal levies.
6. Assignee takes occupancy of unit and all applicable financial obligations.
7. After the condominium is registered, on final closing the Builder transfers title to Assignee. The Assignee pays the balance to the Builder. The Assignee may also pay any amount still owed to the Assignor depending on the terms of the Assignment.
