Home Buyer Rescission Period Calculator
Making a home purchase can be one of your biggest decisions, but it sometimes turns out differently than planned. Sometimes, buying a house may not even be the right move for you. To help avoid major hassles down the line, utilize our Home Buyer Remission Time feature and ensure all parties involved feel satisfied with their choice.
What is the Homebuyer Rescission Time (or HBRP)?
The Home Buyer Rescission period (or HBRP) allows you to cancel your purchase agreement if the seller accepts it. With this right, however, there would be legal consequences and a significant financial penalty.
British Columbia implemented the Homebuyer Bill of Rights on January 20, 2023. Before that, this period had been known as "cooling-off" or the "Homebuyer Protect Period".
Why HBRP Is Important
Things can happen between when you sign your purchase contract and when the seller accepts it. Here are some examples.
- If you lose your job or cannot finance your loan, or it becomes necessary to move your job to another province or city, purchasing a downtown townhouse makes no financial sense.
- In case of an emergency in the family, you may need to return home temporarily with parents.
- After discussing this with your spouse, you have decided to wait another year before purchasing a home. With your new mortgage lender in hand, it has become clear that this offer is more advantageous.
- How long do you have to resign?
In general, you have three business days to cancel your agreement. But this depends on the terms and conditions of your contract. Business days are Monday through Friday; they do not include holidays such as Canada Day, Family Day, Christmas Day etc.
What Properties Are Affected By HBRP
The HBRP may be implemented in various real estate sectors, including:
- Apartments in Multi-Unit Homes of Two or More
- Semi-detached, detached and detached homes
- Manufactured Homes Attached to the Ground
- Residential Strata Lots
- Cooperative interests may own or rent a dwelling and have the "right-of-use" for it.
How much will it cost you to sell your property?
Unfortunately, your offer cannot be withdrawn without payment of a fee. If you opt for the Home Buyer's Rights Program (HBRP), the seller requires you to pay 0.25% of the purchase price; thus, if a townhouse is worth $800,000 then $2,000 would be due (x0.225%).
Brokerages that hold deposits in confidence must pay the rescission charge to the seller, and any balance left over is returned to them. For instance, if you pay $5,000 towards a $800,000 townhouse using the Homebuyers' Relief Program (HBRP), $2,000 of it would be released by the seller while $3,3 goes directly to you.
How do you not notify the seller?
You must send them a formal rescinding notice via registered mail, email with read receipt, fax or personal service.
Your notice should include the following information:
- Your rescission note must contain the following data:
- Your signature and name
- Name of seller
- Address, description and property identifier
Exemptions from HBRP
Here are the exemptions for the rescission period.
- Any sale subject to court order or supervision
- Properties bought at auction
- Leased land makes for an ideal residential real property investment.
- Assignment of Contract Sales
- Multi-unit properties in preconstruction may also be exempted as they already have seven-day rescission periods.
What Do Realtors Owe You?
The Real Estate Board of Greater Vancouver requires your realtor to provide additional mandatory disclosures when you present an offer to purchase. This disclosure outlines the length, amount of rescission fee, deposit handling procedures and exemptions from homebuyer coverage period requirements.
What Should You Be Aware of the HBRP?
Our government still needs to finalize some details regarding HBRP, as it is still very new. As a result, buyers may need to make adjustments during their rescission period.
Please don't hesitate to reach Kim Lee if you have any further queries regarding the HBRP. We would happily assist with your home-buying process and explain how they can help.
Kim Lee - Vancouver realtor
400-1286 Homer St, Vancouver, BC V6B 2Y5