What happens when your condo corporation goes bankrupt?

What happens when your condo corporation goes bankrupt?

Recently, during the Annual General Meeting of the Botanica Private condos and the reveal of a reserve fund study that called for a special assessment (which many people were unhappy about, hence the increase in condos for sale in the building,) I got to thinking, over the past few years we have seen banks, cities, almost some countries go bankrupt…so what would happen if your condo corporation went bankrupt.

So I asked, and I’d like to share the answer with you.

According to Ontario’s Condominium Act, 1998 a condo corporation must undergo a “Reserve Fund Study” every 3 years by an elected auditor.  The study projects the corporations finances for 30 years, and if at any point in the study the reserves would dip below $0 the board of directors must address the issue within 2 year, this usually results in the dreaded “Special Assessment”, which is still often more palatable that a permanent raise in condo fees.

TheTulipTeam.com 

© Dave Williams 2011

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