General-information disclaimer: This article provides general information about Ontario law and is not legal advice. Legal outcomes depend on the specific facts. Obtain advice about your own situation.
A condition is not a decorative clause. It can determine whether a buyer or seller has an agreed opportunity to investigate an issue before becoming fully committed. Conditions should be chosen and drafted for the actual transaction, not copied automatically from the last deal.
Removing a condition can make an offer more attractive, but it can also shift significant risk to the person signing.
A realistic scenario: what can go wrong without advance legal planning
The following is a fictional/composite scenario created for education.
A buyer is pre-approved for a mortgage and assumes financing is guaranteed. To make the offer competitive, the buyer waives the financing condition. The lender later values the property below the purchase price and reduces the amount it will advance. The buyer still has a firm purchase contract and must find another way to close.
What you should know
1. Financing condition
Pre-approval does not always guarantee final financing for a particular property. The lender may still review value, condition, property type and borrower information.
2. Home inspection
An inspection can identify physical issues, but buyers should understand the scope and limits of the inspection they obtain.
3. Status certificate
For resale condominiums, the status certificate contains important information about the unit and condominium corporation. Legal review is commonly made a condition.
4. Lawyer review
A legal-review condition can be especially useful for unusual, commercial, rural or custom agreements.
5. Sale of existing property
Some buyers need the proceeds of another sale. A condition can address that dependency, although sellers may negotiate escape clauses.
6. Special property conditions
Septic systems, wells, tenancies, zoning, insurance, financing type and other property-specific issues may justify tailored conditions.
Practical checklist
- Identify your non-negotiable investigations before offering.
- Understand exactly how and when a condition can be satisfied or waived.
- Diary condition deadlines immediately.
- Do not treat pre-approval as final property approval.
- Seek legal advice before waiving a condition you may later need.
The practical lesson
A condition only protects you if it is properly drafted, used within its deadline and actually addresses the risk you care about.
Get help before the issue becomes urgent
Thomas, Efraim LLP offers free review of residential and commercial real estate offers. If you are considering an offer with limited or no conditions, request legal review before signing whenever possible.
