If purchasing a property that currently has a tenant and you would like to live in it, it is important to ask for vacant possession in your offer.
Many purchasers when looking at a property with the current tenant in place, plan to close on the property and then give the tenant notice to vacant once they are the new owners. However, if there is a tenant occupying the property on closing the lender will look at the property as a rental property regardless of your intentions. As a rental the down payment must be at least 20% of the purchase price any interest rates may be higher.
There’re virtually no lenders that will make an exception to this and many want confirmation the tenants have been given notice to vacant, such as a copy of the N12 that was given to the tenants.
As a current owner who is selling a tenanted property, in this situation, you will need to make arrangements with the tenants to assure the property is vacant for the closing date. As a seller it’s important to know the rules and guidelines set out by the Landlord and Tenants Board.
Andrew Thake is a seasoned mortgage broker with over 15 years of industry experience. He’s assisted more than 2,200 clients in finding their ideal mortgage solutions. Recognized for his excellence, Andrew has received high honours and awards, including the National Rookie of the Year from TD Canada Trust and recognition as a Top 10 Ottawa Mortgage Broker in 2023. He has also been inducted into the Hall of Fame at Dominion Lending Centres and has consistently received their Platinum Award during his tenure as a mortgage broker.
Andrew’s dedication lies in serving his clients and prioritizing their needs with an empathetic approach. Throughout the application process, he provides tailored, informed, and efficient services to ensure the best mortgage solutions for his client’s unique circumstances. The best part of Andrew’s job is when he gets to see the joy on his clients’ faces following their mortgage approval.