Brampton Basement Apartments: In my last post I listed some of Brampton’s zoning requirements for having a rental unit in your home, and promised to talk in this post about the down side of cutting corners. To a lot of people the possibility of creating income from their basements is pretty alluring, and can be either an important factor in their financing, or a post-purchase decision. The first can help you to secure your mortgage, the second provides some financial relief on a monthly basis.
Either way, it’s important to be above boards in setting up your place to meet your needs. However tempting it may be to “just do this” or “only do that,” failing to register your basement apartment or other income unit can seriously jeopardize you as a homeowner in many ways.
Here are three key thoughts that should be taken as encouragement to approach your basement rental properly:
- If you don’t meet City codes, you are breaking the law. You run the risk of being charged and can face fines of as much as $50,000, or even a year in prison for each charge.
- You really want to protect your relationship with your insurance company. Not sharing information with them that directly relates to liability issues will nullify your coverage. So any unexpected incidents that may originate with your tenants will not be covered – which could mean everything to you in the event of catastrophe (think flood or fire.)
- When you set up your basement apartment and find a tenant, you will be more than a homeowner. You will be a landlord. As such, it is a good idea to review landlord responsibilities and rights, as defined by the Province. Check out the Landlord and Tenant Board Website here (http://www.ltb.gov.on.ca/en/index.html).
If you’re like most people, your home is your primary asset. To me it just makes sense to do everything you can to protect that asset. I don’t address this issue with the idea of scarring anyone off, but I do think it’s important to consider the stakes.