Agreement of Purchase and Sale (APS)
The Agreement of Purchase and Sale (APS) is the binding contract between buyer and seller in an Ontario real estate deal — in resale transactions, almost always OREA Form 100 (freehold) or Form 101 (condo). Once both parties sign and the deposit is delivered, it controls everything: price, deposit, conditions, what's included, the closing date, and what happens if someone doesn't perform.
Contents+
Key Takeaways
- In Ontario resale deals the APS is OREA Form 100 (freehold) or 101 (condo) — once accepted, it's a binding contract enforced as written.
- Deposits (customarily ~5% within 24 hours in the GTA) are held in trust and genuinely at risk if you firm up and fail to close.
- Conditions are your protection, but they run on strict written deadlines — managing the waiver clock is part of your agent's job.
- Chattels, rental equipment (hot water tank, HVAC), and fixtures must be spelled out — assumptions are how closings turn hostile.
- Anything unusual in the APS should go to your lawyer before signing; builder agreements always should.
What's Actually in the APS
An Ontario resale APS (OREA Form 100/101) sets out:
Price and deposit: the offer price, the deposit amount, and when it's due — customarily around 5% within 24 hours of acceptance in the GTA, held in the listing brokerage's trust account.
Irrevocability: how long your offer stays open before it dies. On offer nights this is hours, not days.
Completion (closing) date: when money and keys change hands.
Chattels and fixtures: what stays (appliances, light fixtures, window coverings) and what the seller excludes. If it matters to you, list it — 'the fridge' is not automatically included.
Conditions (Schedule A): financing, inspection, status certificate review, sale of the buyer's property — the escape hatches that keep your deposit safe if something fails.
Title search and requisition date: the window for your lawyer to investigate title and demand fixes.
Buyer-side reality: most of the negotiation is not about price alone. Deposit size, closing date flexibility, and conditions are all currency — a seller with two similar offers routinely takes the one with the cleaner terms.
When Does It Become Binding?
The APS becomes a binding contract when the last party signs (acceptance) and it's communicated within the irrevocable period. From that moment:
- A firm deal binds both sides to close — walking away exposes you to losing your deposit and being sued for the seller's damages (including any shortfall if they resell for less).
- A conditional deal binds both sides too, but the buyer can escape by not waiving or fulfilling conditions — with the deposit returned.
Two details buyers under-appreciate:
- Conditions must be exercised properly. Waivers (Form 123) or notices of fulfillment must be delivered in writing before the deadline. Miss the deadline on a condition drafted in the buyer's favour and — depending on wording — the deal may either die automatically or firm up. The wording matters; your agent manages the clock.
- Deposit forfeiture is real. Ontario courts have repeatedly held that a buyer who firm-fails a deal loses the deposit even without proof of the seller's loss. In a falling market, the damages can be far larger than the deposit.
Buyer-Facing Traps We Watch For
'As is, where is' clauses: common in estate and power-of-sale listings — the seller makes no representations about condition. Your inspection condition and pre-offer due diligence do all the work.
Seller Property Information Statement (SPIS): rarely provided; where it exists, treat it as a starting point, not a warranty.
Fixture disputes: EV chargers, mounted TVs, smart-home hardware, hot tubs — modern flashpoints. Write each one into the APS explicitly.
Rental contracts: hot water tanks, furnaces, A/C, and water softeners are often rentals or on buyout contracts that you assume on closing. Schedule A should force disclosure of every rental and its payout.
Closing-date collisions: on a buy-and-sell, closing dates and deposit flows must be sequenced so you're never funding two homes at once — or homeless for a weekend. Bridge financing solves the gap when dates can't match.
Finally: the APS is a legal contract, and your real estate lawyer should see anything unusual BEFORE you sign — not after. For pre-construction (builder) agreements, which are entirely different documents with a 10-day cooling-off period on new condos, legal review is not optional.
Frequently Asked Questions
Can I get out of an APS after signing?+
If the deal is conditional, yes — by properly declining to waive a condition within its deadline, with your deposit returned. If the deal is firm, no — not without the seller's agreement (a mutual release) or serious legal consequences: deposit forfeiture and potential liability for the seller's resale shortfall and costs.
Who holds the deposit, and do I get interest?+
Normally the listing brokerage in its real estate trust account. OREA Form 100 provides for no interest unless a bearing-interest clause is added — on large deposits and long closings, your agent can negotiate an interest-bearing term.
Is a verbal acceptance binding?+
No. Ontario's Statute of Frauds requires agreements for land to be in writing and signed. Until signatures land within the irrevocable window, either side can walk — which is why offer-night communication runs on signed documents, not phone calls.
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