Homebuyers' Deposit Protection – What It Covers, What It Doesn't

The ideal storyline for new home purchases goes something like this: purchaser signs on dotted line, plunks over sizeable deposit, closes deal, moves in and lives happily ever after.

The flipside is not so pretty. Although certainly not the norm, worst-case scenarios do happen, as unlucky buyers found out early this year after their builder Urbancorp went belly up. This week, our post looks at what buyers can expect when a new home deal falls through and their purchase deposit hangs in the balance.

Deposits on new home builds are protected by Tarion – the province's new home building industry watchdog and warranty backstop.

When Does Coverage Kick In?

Purchasers can make a claim on their deposit in one of three scenarios: