If you want to sell your Montreal property quickly, there’s a certain vocabulary you’ll need to know. That’s why we’ve compiled a list of terms often heard when selling a home in Montreal. 
If you have any questions about technical terms, or if you’re not sure you understand the selling process, please don’t hesitate to contact us. We’ll be happy to answer any questions you may have. 514-320-1000
Negative amortization
Negative amortization is a situation in which the payments a homeowner makes each month are used only to repay part of the interest accumulated during that period. In this case, the amount due, rather than decreasing, constantly increases.
Comparative market analysis
A comparative market analysis (CMA) is used to determine the market value of a property. To do this, this analysis takes into account the various properties recently sold in the surrounding area.
Sale and leaseback
A sale-leaseback occurs when someone buys an inhabited property, then leases it back to those who already live there.
Load imposed on the property
An encumbrance on property can prevent its transfer to another person, or even prevent its use. A lien is an example of a charge imposed on property.
Waiver clause
A waiver clause is signed voluntarily and indicates that a right or privilege will not apply to a sale. As a result, the liability normally assumed by one of the parties is completely nullified.
Restrictive clause
A restrictive clause is a formal agreement stating that a transaction will be cancelled if an external event occurs before a specific date.
Conditions
A condition is a clause in the contract that indicates that certain changes must be made by a seller before a sale is considered legal and binding.
Cost of ownership
Ownership costs represent the total expenses incurred each month by an owner. This includes taxes, insurance, electricity and property maintenance.
Seller’s declarations about the property
A Seller’s Declaration of Property (SDP ) is a mandatory form that must be completed by a seller and forwarded to his buyer to let him know what defects and problems are attached to a property. Incomplete disclosure of information may be considered fraudulent and may result in legal action against the seller.
Estimate
An appraised value is an amount determined by a professional who assesses the value of a property. An estimate can be requested by the bank during the mortgage application process, or arranged independently by a seller or buyer. Estimates can also be useful in managing property taxes, or in helping a divorcing couple divide joint property.
Default
A property is in default when an owner falls behind on mortgage payments. When a property is in default, a lender may initiate a process of asset collection, up to and including repossession of finance.
Property assessment
A property assessment determines the amount a homeowner will have to pay in taxes. An appraiser is a professional who takes into account, among other things, location, available utilities, and recent real estate sales in the area.
Quality guarantee
The quality warranty is a component of the legal warranty. This warranty protects the buyer in the event of hidden defects.
Guarantee of property rights
The right of ownership guarantee is a component of the legal guarantee. This guarantee serves to prove that a property belongs legally and exclusively to a seller, and that a property does not violate any local laws, in addition to being free of any rights (legal mortgage, easement, etc.).
Legal warranty
The legal warranty assures a buyer that he is purchasing a property legally and safely. The legal warranty has two components: the right of ownership warranty and the quality warranty.
Legal mortgage
A legal hypothec is a charge imposed on the property that serves, for example, to assure workers that they will receive their wages as well as payment for materials supplied for the construction or repair of a property.
Inclusions
Inclusions are personal items that are included in the sale. A household appliance, piece of furniture or outdoor accessory, for example, could be an inclusion.
Financial recovery
A financial repossession is triggered when a homeowner defaults on monthly mortgage payments for approximately 90 days. When a finance takeover takes place, the owner loses all rights to the property, and the building becomes the legal property of the bank.
Title deeds
The title deed proves that a building belongs legally to its owner.
Market value
Market value is the amount for which it is estimated that a property could be sold in a mutual agreement between a seller and a buyer, without them having received any outside pressure. The market value of a property is generally calculated as the average of the highest amount a buyer would be willing to pay and the lowest amount a seller would be willing to sell for.
Short selling
Short selling occurs when a property is sold for less than the amount owed on the mortgage attached to it. A sale at a loss such as this enables the bank to avoid the even greater losses it would face by executing a financial recovery.
Title defect
A defect in title is a situation in which someone disputes the title to a property. Such a dispute may alter the legal ownership of a property.
If you’re trying to sell your Montreal home fast, you’re bound to hear a bit of real estate jargon here and there. We can’t stress enough the importance of understanding the discussions that take place and what is implied by each of the technical terms used. Before selling your Montreal home, do a little research. This will save you from making a lot of mistakes!
