How do pre-construction deposit structures work?
A builder deposit is usually paid in stages rather than as one lump sum. The schedule may call for a payment on signing, additional amounts 30, 60 or 90 days later, later anniversary payments and a final amount at occupancy. The percentages and timing vary by project and property type.
That timing affects affordability. Two homes with the same price can require very different cash flow if one calls for 20% within a year and another spreads a smaller total over several years.
How should you compare two deposit schedules?
Write each payment and due date on a calendar, then calculate three numbers: cash required in the first 90 days, total deposit before occupancy and the largest single payment. Do not compare only the advertised total.
For example, Aura at Lakeview Village publishes an eight-stage fixed-dollar schedule totalling $65,000. That structure should be compared with your available liquid funds—not with an assumed future sale, bonus or refinance.
Also confirm the accepted payment method. Some builders require a bank draft on signing and post-dated cheques for later stages. Missing a payment can put the agreement in default.
How much deposit protection applies?
Tarion’s pre-possession coverage guidance explains current deposit protection. For condominium units, Tarion protects eligible deposits up to $20,000; amounts above that are subject to trust or security requirements under condominium law. For freehold homes, protection can reach $60,000 for homes priced at $600,000 or less, or 10% of price up to $100,000 for higher-priced homes.
Protection rules do not make every payment risk-free. Confirm who receives the funds, obtain receipts and have your lawyer review the agreement and trust wording.
What happens if the project is delayed or cancelled?
Your rights depend on the agreement, the Tarion addendum and applicable law. A returned deposit does not compensate you for years of lost market time or opportunity cost. Review early-termination conditions, outside dates and any interest treatment before signing.
A practical buyer checklist
- ▸Keep every payment date in two calendars
- ▸Maintain the deposit in liquid, low-risk funds
- ▸Confirm assignment or leasing incentives separately
- ▸Review cancellation and refund clauses with counsel
- ▸Keep a second reserve for closing costs
Broker’s bottom line
The best schedule is not automatically the lowest deposit. It is the schedule you can fund comfortably while preserving an emergency and closing reserve. If the deal only works when future income arrives perfectly on time, the deposit structure is too aggressive. Build the schedule around confirmed cash, not hoped-for cash. Save receipts for every payment and verify that each one appears on the builder statement. Never pay outside the lawyer-approved instructions. Protect liquidity first.