When Do I Need to Pay the Deposit?

In Toronto’s real estate market, paying the deposit promptly is crucial. It is often required as soon as possible to secure your offer. Here’s a detailed look at deposit payments and the best practices to ensure your offer stands out.

Timing and Importance of the Deposit

1. Immediate Payment

In Toronto, the expectation is to provide the deposit cheque immediately, often at the time of submitting the offer. This prompt payment demonstrates your seriousness and commitment to the purchase, making your offer more attractive to the seller.

2. Competitive Markets

In highly competitive areas like downtown Toronto, including the deposit cheque with your offer is standard practice. This means you must have the funds readily available, ensuring that your financial institution can issue a certified deposit cheque without delays. Include a photograph of your certified deposit cheque with the offer paperwork to confirm that you have the necessary funds.

Managing Deposit Funds

1. Access to Funds

It’s essential to have quick access to your deposit funds when searching for a home or condominium. Ensure that your financial resources, such as savings, RRSPs, or stocks and bonds, can be accessed swiftly. If you bank with institutions like President’s Choice or Tangerine, which lack physical branches, you may need to coordinate with their affiliated companies to secure your deposit funds in a timely manner.

2. Non-Competitive Scenarios

If you are not in a competitive offer scenario, submitting the deposit cheque with the offer might not be necessary. In such cases, the deposit is typically due within 24 hours of the offer being accepted. The buyer and buyer agent are responsible for ensuring the funds are collected and delivered to the listing brokerage within this timeframe.

3. Good-Faith Gesture

Even when not in a bidding war, submitting your deposit cheque with the offer is highly encouraged. This good-faith gesture can positively influence the seller’s decision, showing that you are a serious buyer ready to proceed.

By understanding the timing and importance of deposit payments in Toronto’s real estate market, you can better prepare to make a strong offer, improving your chances of successfully purchasing your desired property.

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