For those involved in issuing mortgages on condominium units in the province of New Brunswick, you may be interested to know that the updated legislation now allows a Condominium Corporation to place a lien on condo units. This can happen if the owner has not paid for condominium fees, special assessments, or for damage and repairs. The Corporation also has the right to recover interest and reasonable legal costs and expenses it has incurred while collecting or attempting to collect the unpaid amount. Once the lien is registered, it becomes enforceable and takes precedence over a first mortgage.
New Brunswick Condominium Property Act – CHAPTER C-16.05
46(4) Subject to any other Act, a lien under subsection (1) is payable in priority to a registered or unregistered encumbrance in respect of the unit and the common interest.
Prior to a mortgage being granted on any condominium unit, the lender should ensure that a properly-authorized Estoppel Certificate is requested from the Condominium Corporation.This document must be prepared using the prescribed format, Form 14, as per the Regulations under the New Brunswick Condominium Property Act. The use of this form provides consistency in reporting critical information about the financial and legal aspects of the Condominium Corporation and the specific unit you plan to issue a mortgage on. An Estoppel Certificate is conclusive proof of these details.
Condo-Link Services can provide further details on how a mortgagee can determine what risks may be associated with mortgaging a condominium unit. To arrange a meeting or to request more information, contact Condo-Link Services. We can offer a brief information session on what a proper Estoppel Certificate looks like, who can sign an Estoppel Certificate, and what information must be revealed.