Short answer
Purchaser-use termination generally requires at least 60 days’ notice ending on the proper rental-period or lease-term date, plus compensation equal to one month’s rent or an acceptable replacement unit by the required deadline.
The buyer or owner’s concern
The closing date is set in 30 days, but the tenancy and notice dates do not align. The buyer assumes paying compensation allows the tenant to be removed immediately.
What Ontario’s official guidance says
LTB materials describe Form N12, termination timing and compensation. The landlord who serves the purchaser-use notice bears the compensation obligation, and an application to the LTB may still be required.
What the rule does not guarantee
Compensation does not purchase immediate vacancy, and accepting it does not necessarily mean the tenant has waived a hearing. Incorrect timing, form, service or compensation can undermine the application.
A practical Ontario example
Illustration only: An offer closes May 15 but the valid termination date cannot occur until later. The mortgage may fund the property as a rental first, and owner-occupied insurance or qualification assumptions may need to be revisited.
Practical next steps
Coordinate the APS, notice and closing date through the lawyer and realtor. Tell the mortgage broker immediately if occupancy changes because it can affect the lender, insurer, down payment and rental-income calculation.
Questions to ask before relying on the rent
- What is the current lawful rent and when was it last increased?
- Is the unit guideline-covered or genuinely exempt?
- Do the lease, notices, ledger and seller’s statements agree?
- Does the purchase require vacant possession or future higher rent to remain affordable?
- Which issue needs a lawyer or licensed paralegal before conditions are waived?
Rajiv’s broker perspective
A lender’s rental worksheet and Ontario tenancy law answer different questions. The lender may recognize only part of the rent, while the owner may also be unable to increase rent or obtain vacancy on the expected date. I would qualify the mortgage using verified lawful rent, test vacancy and repair reserves, and compare A, alternative/B, MIC or private options only after the legal occupancy assumptions are confirmed.
Related: Real Estate Centre · Mortgage Knowledge Centre · Updates & Rules Centre
Buying or refinancing a tenant-occupied property?
Send Rajiv the property type, lawful rent, lease dates and intended occupancy. He can test the mortgage using realistic rental assumptions and identify when independent landlord-tenant advice is needed.
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