Mortgage Blog

We helped get a Builder's Lien removed from a Strata/Condo unit and our Client obtained a New Mortgage with Great Terms!

July 5, 2014 | Posted by: Kelleway Mortgage Architects

A referral from one happy client to a friend, led to another happy client now free of an unexpected Builder's Lien.

' Dear Strata Neighbours,
Due to a life event, I needed to reorganize my mortgage financing. The building lien was an obstacle that Glen and his team helped me overcome.
And, I am really happy with the result! If you need excellent mortgage advice and service, I highly recommend Kelleway Mortgage Architects.'
Your neighbour, a Boundaryview Resident

What is a builders lien?

“ A builders lien secures a claim for payment for work done on – or materials supplied to – a construction project or for repairs or renovations made to an existing structure.  When a lien is registered in the Land Title Office, it becomes a charge against the title to the land or property involved.”
 - Canadian Bar Association of BC
 

What happened and how we helped with a great outcome for our client.

This doesn’t happen very often, but when it does it can really put a strata unit owner in a bind!  As a result of a dispute amongst a subcontractor, contractor and a strata (condo) corporation over an unpaid bill, more than 200 individual strata units were each registered with a builders lien.  For the sake of less than $500 per unit entitlement (or unit factor) and a pending lawsuit, our client was being blocked from refinancing a mortgage on her condo home.

Our client wanted to buy out the other co-owner of the condo and remove that person from both the mortgage and property title.  In order to do so, she needed to refinance her mortgage.  Her bank told her they would not refinance until after the lien was removed from all strata units.  Due to life circumstances, she did not want to wait months - or possibly a year or more - until the court action was settled (i.e., lien removed) to refinance her property.

We became part of her story after her friend recommended us.  We recognized her situation as similar to other mortgage issues we have resolved in the past.  With a little creative thinking and help from our network of professionals, we were confident that we could do better for her than her bank.

Here’s How We Helped:

1.   Calculations.  With client input, Glen worked with the numbers for both owners to distribute liabilities (i.e., debt) and determine the share of remaining equity in the condo. The two co-owners managed to reach an agreement and took Glen’s calculations to their respective lawyers to approve.  With that in hand, our client was able to buy out the other owner so that she could remain living in the condo.

2.   Research.  We knew the client would qualify for financing.  We then assembled a shortlist of lenders who were willing to loan to our client if the lien were removed from only her unit.  A lien would remain on the rest of the condos within the strata (condo) corporation.

3.   Network Negotiations and Mediation.  Glen reached out to our network of lawyers and sourced a condo expert who agreed to work with our client to remove the lien from her strata (condo) unit.  We also acted as the go-between amongst other lawyers including the:

 - co-owner’s lawyer,

 - sub-contractor’s lawyer,

 - strata corporation’s lawyer, and

 - conveyancing lawyer

4.   The Legwork.  Via phone calls, email, text messaging, web meetings and one in-person meeting, Glen and Serena organized the process and digital paperwork so that everything happened in sequence and as quickly as the legal process would allow.

5.   Follow-Through.  We processed the digital paperwork listed below and followed through with the lender to ensure that the mortgage funded without a hitch.

• 
   - Purchase contract between client and co-owner
•  - Appraisal report
•  - Strata Form B
•  - Strata Minutes including AGM and SGM minutes
•  - Mortgage Commitment (signed Approval)
•  - Authorization for Undertaking (basically the quote for her portion of the payment)

A Great Outcome and a Very Happy Client!

We managed to negotiate with all parties on behalf of our client so that:

1)    her portion of the building lien was paid into trust,
2)    the lien was removed from title on just her unit,
3)    she was able to refinance, payout her existing mortgage, and buy out the co-owner’s share in the property,
4)    the co-owner was removed from the existing mortgage and property title, and
5)    she obtained a new mortgage with great terms registered in her own name.

We did not charge the client any extra fees for this extraordinary service as we were paid a finder’s fee by the new lender for originating the new mortgage.

What's the Next Step for You?
1)    Keep us in mind and on hand in case anyone you know runs into the same sort of situaltion.
2)    Share this post with your friends and family because you never know when the info could come in handy.
3)    Call or Email Us just to connect and get started talking about your plans. (see below)
4)    Sign Up for Glen's Perspective newsletter > Click here

Glen Kelleway, BSc, AMP, Senior Mortgage Planner & Owner

If you would like us to contact you by phone or email, please click Contact Us Kelleway Mortgage Architects will get back to you within one business day.

Phone: 604-476-0053
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