[SRAMP]

Lenders file application to place several GTA Vandyk housing projects in receivership

2 housing development projects in Brampton, one in Etobicoke and 2 more in Mississauga named in Superior Court filing

www.bramptonguardian.com

" "The Vandyk Group remains committed to seeing its projects through to completion,” said Dan Rosenbluth, Vandyk’s lawyer. He said the group is working to secure new sources of financing to help continue the projects, through several experienced real estate investors. “The Vandyk Group’s goal is to complete these arrangements early in the new year, at which point a further update will be available to all stakeholders,” he said."

How in the entire f*** do they plan on doing that?

Vandyk narratives are the words written on water. They would change as per circumstance. After January, they would release different statements.

 

[gquest]

 

[jbaa1]

View attachment 523492

Thx for sharing!

 

[SRAMP]

"The Receiver understands that the Unit Buyers’ deposits are insured by Tarion Warranty Corporationand excess condominium deposit insurance provided to the Company by Trisura Guarantee InsuranceCompany" does that mean our deposit is 100% insured? 20k from Tarion and remining from ECDI?

 

[jbaa1]

"The Receiver understands that the Unit Buyers’ deposits are insured by Tarion Warranty Corporationand excess condominium deposit insurance provided to the Company by Trisura Guarantee InsuranceCompany" does that mean our deposit is 100% insured? 20k from Tarion and remining from ECDI?

Yes. This is great news, we may be able to get our deposits back as early as March~April.

 

[gquest]

"The Receiver understands that the Unit Buyers’ deposits are insured by Tarion Warranty Corporationand excess condominium deposit insurance provided to the Company by Trisura Guarantee InsuranceCompany" does that mean our deposit is 100% insured? 20k from Tarion and remining from ECDI?

Yeah. I think money in trust was loaned to Vandyk. That should explain the ECDI. Because I see no reason why there's ECDI if deposits are still 100% in trust.

 

[DavidCapizzano]

@mods can we move some of these conversations to the real estate thread? Feels like the convo here is happening in the wrong spot

 

[athundo]

View attachment 523492

Did anyone else get this communication? Doesn't seem like I did.

 

[gquest]

Did anyone else get this communication? Doesn't seem like I did.

It will come in the mail. I'm also yet to receive mine. Got this from KSV case folder, on their website.

 

[AHK]

Yeah. I think money in trust was loaned to Vandyk. That should explain the ECDI. Because I see no reason why there's ECDI if deposits are still 100% in trust.

Edited to remove incorrect information. I was not aware of the Excess Condominium Deposit Insurance program, or with it, the ability of the developer to borrow against the purchasers' deposits.

 

[Deanfeb]

Yeah. I think money in trust was loaned to Vandyk. That should explain the ECDI. Because I see no reason why there's ECDI if deposits are still 100% in trust.

Then if deposit is covered by Tarion many would not get their full deposit as tarion has limits

 

[gquest]

There is something strange here. My understanding is that the deposits paid the purchase of new condominiums are paid to the developer's lawyer 'In Trust', and must be deposited into the lawyer's trust account maintained for handling of client funds - separate from lawyer's own business operating account. The lawyer should not be in a position to 'lend' the funds back to the developer. If the lawyer withdrew funds from the trust account and forwarded them back to the developer, there would be a huge liability on the lawyer, and the Ontario Law Society would be all over it. Ultimately, if this did happen, and the funds were unrecoverable, I would believe the Law Society's professional liability insurance fund would be called on to make up any shortfalls.

If the financial institution which held the trust account went and loaned the funds back to the developer, and the funds were non-recoverable, the loan to the developer would be a liability of the financial institution - an FI cannot lend funds, fund a loan from a specific deposit account. The only case where this can happen is when a homeowner arranges hold their mortgage in their RRSP - a very restricted situation. So if the FI holding the lawyer's in trust deposit account did turn around and lend funds to the developer, it is the FI's problem - they would still be responsible to pay out the funds in the trust account when they are legitimately withdrawn, either to close the purchase, or refund the deposits back to the purchaser if the project is cancelled.

Of course this does not apply to the amounts paid for upgrades - in that case, I believe the purchaser would become one of the many unsecured creditors of Vandyk, with any ultimate payout depending on the proceeds of the ultimate liquidation of Vandyk's assets, and how much is left over for the unsecured creditors.

It certainly appears, to me at least, that the receiver may have, in this case, taken on a situation outside of their normal experience.

In Ontario, Excess Condominium Deposit Insurance or “ECDI” allows developers access to purchasers’ deposits that would otherwise be tied up in a trust account. Developers who utilize an ECDI policy end up saving money as the deposit access is typically a much cheaper source of financing than traditional bank financing.

ECDI policy is issued on new residential condominium projects in Ontario. It is issued to guarantee purchasers’ deposits in excess of the $20,000 which are already guaranteed through the posted Tarion Warranty Security. If the developer uses the deposits and can’t deliver the condo or pay back these deposits, the ECDI policy will refund these deposits.

 

[gquest]

Then if deposit is covered by Tarion many would not get their full deposit as tarion has limits

20k from Tarion and the remaining from Trisura.

 

[SRAMP]

Then if deposit is covered by Tarion many would not get their full deposit as tarion has limits

yes, it seems ECDI will cover the deposits more than $20,000.
Also developer cant access our deposits without ECDI. So, it appears our deposits are safe and 100% insured. fingers crossed !!!!

 

[gquest]

Edited to remove incorrect information. I was not aware of the Excess Condominium Deposit Insurance program, or with it, the ability of the developer to borrow against the purchasers' deposits.

Yeah, it's a cheaper way for the builder to get financing before exploring other options.