FREQUENTLY ASKED QUESTIONS
Everything condo boards and strata corporations need to know about financing options in Canada — from reserve fund shortfalls to special assessments to capital repair loans.
Condo Financing Questions
A condo corporation loan is a financing arrangement taken out by the condominium corporation (not the individual unit owners). These loans are typically used to finance major repair and replacement projects when there is a shortfall of reserve funds. These loans can also be used to acquire assets like superintendent suites or geothermal systems, or to fund an operating deficit.
The loan is repaid over time through the corporation’s common expenses, or as a separate monthly loan payment charged to unit owners.
Common reasons include:
The condominium corporation is the borrower and is responsible for the loan repayments.
Loan repayments are raised and collected from unit owners as part of the common expenses, or as separate monthly loan payments, based on each unit’s proportionate share.
The loan is secured by a General Security Agreement (GSA) against the condominium corporation’s personal property.
Unit owners do not provide any direct security for the loan, and no security interest is registered against individual unit titles or against unit owners.
Yes. A condo corporation loan does not prevent unit sales.
Maintaining competitive condo fees following implementation of a loan is an important consideration, but the existence and disclosure of a loan with the condo corporation alone does not restrict the ability to sell a unit.
Condominium Lending Group specializes in providing tailor-made financing solutions for condo corporations facing reserve fund shortfalls or other financial challenges.
Our team of industry leaders conducts a thorough analysis to deliver a customized solution that meets the needs of the community. By spreading the repair costs over time, we enhance the corporation’s cash flow and enable condo boards to maintain their properties while keeping a robust reserve fund and protecting unit values.
Our team are experts in helping condo boards understand their financial options, and we are committed to helping communities through the loan process with clear, balanced, and transparent communication with the unit owners.
MORE INFORMATION?
Our team is happy to answer any question about condo corporation financing in Canada. Reach out directly and we’ll get back to you within one business day.
