Canadian Real Estate Trivia (Part II)

Canadian Real Estate Trivia (Part II)

Hopefully by now you have had success in locating the best mortgage rates for your upcoming real estate purchase. Let’s wrap up our look at Canadian rest estate trivia.

Question: What is an “SPP offer”?
Answer: An “SPP offer” is real estate agent lingo referring to an offer to purchase for a property that is contingent upon the purchaser selling his or her current property first.

Question: True or False? Only SPP offers can have an “escape clause” written into them.
Answer: False. There is a common misconception that the escape clause (which allows another offer to bump the SPP offer), can only be used with an SPP offer. In fact, an escape clause can be used with any type of conditional offer. Furthermore, an SPP offer does not have to contain an escape clause if all parties are in agreement.

Question: What does the term “lis pendens” refer to?
Answer: According to the website, the term “lis pendens “ …is Latin for ‘a suit pending,’ a written notice that a lawsuit has been filed which concerns the title to real property or some interest in that real property.

Question: What is “Negligent Misrepresentation”?
Answer: “Negligent Misrepresentation” refers to the situation whereby a real estate agent innocently misrepresents the facts about a property (when they should have known the true facts – based upon assumed expertise). If an agent is found to have engaged in Negligent Misrepresentation then that Agent can be sued and held responsible for the misrepresentation, even though it was not intentional.

Question: Can real estate companies band together to set fixed commission rates?
Answer: No. The Competition Act makes it illegal for real estate companies to get together with other real estate companies to set fixed commission rates.

Question: When looking to purchase a home, do I need to get a home inspection?
Answer: It may be a requirement to get an inspection as the home is subject to the Mortgage Lenders approval. Always get referrals from your family, friends and mortgage broker or lender for reputable Home Inspectors.