It can be challenging to navigate the complex aspects of condominium management, especially when it comes to unpaid condo fees. Navigating the process of managing registered liens for unpaid condo fees is essential to maintain the financial stability of a condo corporation. Addressing unpaid condo fees quickly ensures that each resident contributes fairly for the maintenance and improvement of the condo community.
What is a Lien?
In condominium management, a lien is a legal claim issued on the property when an owner fails to pay their percentage of common expenses (condo fees). Corporations in Ontario can utilize a condominium lien as a powerful tool for collecting unpaid condo fees. The corporation legally claims a portion of the property’s value, equivalent to the outstanding amount of condo fees, until the debt is settled.
Why Registering Liens is Crucial for Your Condo Corporation’s success?
It is important for a condo company to receive the condo fees on time to be able to continue its operations. This helps to maintain shared spaces, establishes reserves for future maintenance, and preserves the property’s appeal as a desirable place to live.
When owners don’t pay, it puts financial pressure on the corporation, which may lead to higher fees or fewer services for other residents. Therefore, registering liens for unpaid condo fees is essential to maintain the financial stability of the condo association and to safeguard the property’s value.
The Condo Lien Process in Ontario
Several legal rules governing the condo lien process in Ontario must be closely followed to guarantee that the lien is legitimate. The lien process typically begins with a formal notification of the outstanding fees and the intention to file a lien if the amount is not paid within the allotted time. The corporation may then file a lien against the property if the owner neglects to pay the debt. If this lien is not registered within a certain time after the fees are due, the corporation risks losing its priority over other claimants.
Overview of the Lien Process
- Send a notice of the lien to the condo owner
- Register a “Certificate of Lien” with the Land Registry Office
- Issue a “Notice of Sale Under Lien”
- Judgement by the Ontario Superior Court of Justice (OSCJ)
- Selling the condo unit to recoup condo fees
How to Register Liens for Unpaid Condo Fees in Ontario
The first step in registering lines for unpaid condo fees is to prepare a “Certificate of Lien” detailing the amount owed along with any additional costs. The Land Registry Office must then record this certificate, adding it to the property’s official title.
When a condo lien is registered, it becomes public information that notifies lenders or prospective buyers of the existing obligation. The lien is in effect until the debt is settled in full, including all related court and administrative fees.
How to Collect Condo Fees from a Lien
The condominium corporation can initiate the power of sale process for the condo unit 15 days after the “Certificate of Lien” is registered with the Land Registry Office. From this point, the condo owner has 45 days to settle the debt. This is called the “Redemption Period”. If the debt is paid in full, the condo corporation is obligated to discharge the lien. If the debt is not paid in 45 days, the condo corporation can file a “Statement of Claim” with the Ontario Superior Court of Justice to claim the amounts owed.
Usually, condo corporations will request possession of the unit to recover the amounts they are owed. They will recoup the amount of the lien from the proceeds of the sale. Once the lien is paid, the balance of the funds must be transferred to the original owner within 90 days of the sale.
Larlyn, Your Expert Partner for Navigating Condo Lien Complexities
Handling condo lien procedures requires experience and a thorough understanding of legal processes. Larlyn can help your organization efficiently navigate these processes, drawing on its extensive experience in condo administration. With Larlyn taking the responsibility to protect their financial interests, condo corporations can concentrate on other important areas of property management.
