HomeLife Miracle Realty Ltd., Brokerage
HomeLife Miracle Realty Ltd., Brokerage
What the most common OREA forms, terms, conditions and clauses in an Ontario Agreement of Purchase and Sale actually mean for buyers and sellers, before you sign.
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The Basics
OREA stands for the Ontario Real Estate Association. It publishes the standard forms most REALTORS® in Ontario use to write offers, change them and confirm conditions. Using OREA forms means buyers, sellers, agents and lawyers all work from a document they already know, but what really protects you is what gets written into the blanks and the schedules.
The pre-printed parts of OREA forms stay the same from deal to deal. The parts that change are the price, deposit, dates, chattels and fixtures, and the clauses added in Schedule A. That is where most mistakes and most negotiating happen.
When an offer is accepted and the acceptance is communicated, you have a legal contract. Resale homes in Ontario have no cooling-off period, so read everything before you sign, not after.
Your real estate lawyer does the title search, handles the mortgage documents and closes the deal. If an offer has unusual terms, ask a lawyer to review it before it goes firm.
| OREA form | What it is used for |
|---|---|
| Form 100 | Agreement of Purchase and Sale for freehold homes: detached, semi, freehold townhouse |
| Form 101 | Agreement of Purchase and Sale for resale condos |
| Form 120 | Amendment: changes the price, dates or terms after both sides have signed |
| Form 122 | Mutual Release: both sides agree to cancel the deal and how the deposit is handled |
| Form 123 | Waiver: the buyer (or seller) gives up a condition so the deal becomes firm |
| Form 124 | Notice of Fulfillment: confirms a condition has been met |
Plain English
These are the terms people ask me about most when we go through an offer together.
The deposit shows the buyer is serious. On many OREA offers it is paid within 24 hours of acceptance and held in trust by the listing brokerage, then credited to the buyer on closing.
How long the offer stays open for the other side to accept. After that time it is dead unless it is accepted or extended.
Closing day, when the money changes hands and the buyer gets the keys. Choose it carefully, especially if you are also selling or ending a lease.
The deadline for the buyer’s lawyer to raise problems with the title, such as unpaid work orders or registered claims.
Chattels are movable items, like appliances, that are included only if listed. Fixtures are attached, like light fixtures, and stay with the home unless they are listed as excluded. Write down anything that matters to you.
Water heaters, furnaces and water softeners are often rented. The offer usually says the buyer takes over those contracts, so ask for the monthly cost before you sign.
Most resale homes are exempt from HST. Offers usually say HST is “included in” the price if it applies. New homes and some substantially renovated homes are different, which is why the line matters.
Schedule A is where the conditions and extra clauses go. OREA agreements also say time is of the essence, which means deadlines are strict: miss one and the deal can end.
Protecting Buyers
A condition gives the buyer a set number of days to check something before the deal becomes firm. If it is not met, the buyer can walk away and get the deposit back. To keep the deal, the buyer signs a waiver or a notice of fulfillment before the deadline.
Gives you time, often about five business days, to get final mortgage approval on terms you are happy with. Important if you have not been fully approved for this specific property.
Lets you hire an inspector and back out, or negotiate, if they find serious problems. Highly recommended on older homes in Galt, downtown Kitchener or central Guelph.
For condos. Gives your lawyer time to review the condo corporation’s finances, reserve fund, rules and any lawsuits before you commit.
Makes the purchase depend on selling your current home. Sellers often add an escape clause so they can keep marketing and accept a better offer if you do not remove the condition in time.
Gives your lawyer a few days to review the agreement. Useful for unusual properties or terms.
Confirms you can get home insurance at a reasonable cost, which can matter for older homes with oil tanks or knob-and-tube wiring.
For rural homes around Ayr and North Dumfries. Lets you test water quality and flow and inspect the septic system.
In competitive situations, some buyers do their homework before offering and submit without conditions. Only do this after you have done the inspection and are confident in your financing.
Protecting Sellers
Used with a sale-of-property condition. If the seller gets another acceptable offer, the buyer has a short window, often 48 to 72 hours, to remove their conditions or the deal ends.
Statements the seller makes about the home, for example about past use or known issues. Sellers should only agree to what they know is true, and buyers should not rely on them instead of an inspection.
Estate sales and some investment properties are sold as is, with the seller making no promises about condition. Buyers should inspect carefully, since there is little to fall back on after closing.
An optional questionnaire about the home. Sellers are not required to complete it, and if they do, answers must be accurate. Many lawyers advise sellers to be cautious with it.
If the seller is not a resident of Canada, the buyer’s lawyer may hold back part of the price until the seller provides a CRA clearance certificate. Plan for this in the closing timeline.
Buying a Condo
A package from the condo corporation covering fees, the reserve fund, budget, rules, insurance and any legal claims. The corporation has 10 days to provide it after it is requested and paid for.
You own your unit and share the common elements, like hallways and grounds. Balconies, parking spots and lockers are often exclusive-use common elements or separate units, so the offer should spell out exactly what you are getting.
The offer states the current fee. Ask what it covers, whether an increase is planned and whether there have been special assessments.
Rules on pets, rentals, renovations and parking can affect how you use the unit. Read them during your status certificate review.
Working With an Agent
Since December 1, 2023, Ontario’s Trust in Real Estate Services Act (TRESA) has required brokerages to put client relationships in writing and to give consumers RECO’s information guide before providing services.
Sets out what your agent will do for you, the area and type of property, how long the agreement lasts and how the brokerage is paid. Read the dates and the geographic area carefully before you sign.
For sellers. Covers the list price, how long the listing runs, the commission and any holdover period after the listing ends.
You can buy or sell without your own agent, but the other side’s agent cannot advise you. Brokerages must explain this in writing.
If one brokerage represents both buyer and seller, both must agree in writing, and the brokerage cannot advocate for either side on price.
Competitive Situations
Many sellers set an offer night and review all offers at once. Buyers should have their deposit, pre-approval and inspection plan ready before that date.
An offer sent before the offer date, often with a short deadline, hoping the seller will accept early. The seller decides whether to consider it.
Under the 2023 TRESA rules, a seller can choose to let their agent share the details of competing offers. Otherwise, only the number of offers can be disclosed.
A buyer can ask the listing brokerage for written confirmation that an offer was registered, which is a good way to make sure your offer was presented.
Special Situations
The buyer takes over the existing tenancy unless the seller arranges vacant possession. If you want to move in, the offer needs to spell out how notice will be given under the Residential Tenancies Act, and the buyer usually has to provide a written declaration. See my renting in Ontario guide.
Estate trustees and lenders selling a home often use their own schedules that limit warranties and disclosure. Read them carefully and inspect before you firm up.
Builders use their own agreements rather than OREA forms, plus the Tarion addendum for freehold homes. Closing costs, HST rebates and delayed closing rules are different, so have a lawyer review the agreement.
Add conditions for well water testing, septic inspection, zoning and, where relevant, conservation authority rules. These are common around Ayr and the townships near Guelph and Woodstock.
An OREA offer can allow the buyer to assign the agreement to someone else before closing. Sellers often limit or prohibit this, so check the wording.
If either side needs more time, both must agree in writing using an OREA amendment. Changing dates can also affect mortgage approvals and insurance.
Before You Sign
When Things Go Wrong
Usually in the listing brokerage’s trust account. It cannot simply be handed back to either side once the deal is firm.
If a conditional deal ends because a condition is not met, both sides sign a mutual release (OREA Form 122) and the deposit is returned. In a dispute, it stays in trust until both sides agree or a court orders its release.
A buyer who backs out of a firm deal can lose the deposit and may be sued for the seller’s losses, such as a lower resale price. Talk to a lawyer before doing anything.
If both sides agree to change the price, dates or terms after signing, the change should be made in writing on an OREA amendment form, not just over text or email.
No. Once a resale offer is accepted it is binding. New condos from a builder have a 10-day cooling-off period, but resale homes do not.
A waiver (Form 123) gives up a condition. A notice of fulfillment (Form 124) confirms it has been met. Either one, delivered on time, can make a conditional deal firm.
Often three to five business days, but it depends on how quickly you can book an inspector. Line one up before you make the offer.
Clauses should be written carefully by your REALTOR® or lawyer. Vague wording can cause disputes or make a condition impossible to enforce.
Leases in Ontario must use the government’s Standard Form of Lease. See my guide to renting in Ontario.
OREA forms are licensed for use by REALTORS® who are members of the Ontario Real Estate Association, so you will usually see them when an agent is involved on at least one side. If you are buying or selling privately, a real estate lawyer can prepare or review the agreement instead. Either way, the same principles apply: clear dates, clear conditions, and clauses that say exactly what both sides agreed to.
Most OREA conditions say the deal becomes null and void if the condition is not waived or fulfilled by the deadline, and the deposit is returned. Read the wording carefully, because some conditions work the other way around.
Sources: RECO: Real Estate Council of Ontario · OREA: Ontario Real Estate Association · Law Society Referral Service · Tarion (new homes)
General information only, not legal advice. Clause wording matters, so every offer should be written by a licensed REALTOR® and reviewed by a real estate lawyer when needed. OREA forms are the property of the Ontario Real Estate Association and are not reproduced here.
Jeewan Sidhu, REALTOR®Usually replies the same day
I will walk you through every OREA form and clause before you sign, in English, Punjabi, Hindi or Urdu. No pressure, no obligation.