When an Ontario new-home closing runs past the builder's Firm Closing Date, Tarion's delayed-closing compensation isn't a negotiation — it's a fixed $150-a-day living-expense payment, capped at $7,500, that starts accruing automatically the day the firm date is missed.
Tarion's own figures set the formula precisely: “Delayed closing compensation for living expenses (meals and accommodation) is payable based on a fixed amount of $150 a day for each day of delay until the Delayed Closing Date or the date that the purchase agreement is terminated.” A separate penalty stacks on top of that: “In addition, if your builder fails to give you 10 days notice of a closing delay, you will be compensated in the amount of $1,500 ($150 x 10 days).” Both amounts count toward one ceiling — “builders are required to compensate purchasers to a maximum of $7,500” once closing is delayed beyond the Firm Closing Date, outside of mutual agreement or an Unavoidable Delay.
This is a different notice rule from the one that creates a Firm Closing Date in the first place: converting a tentative date to a firm one requires the builder to give “written notice — usually at least 90 days in advance,” per treadstonelaw's summary of the mechanics (see firm vs. tentative closing dates). The delayed-closing compensation regime above only starts once a Firm date exists and is then missed. For a builder, the 10-day notice rule is also the cheapest lever on the exposure: giving buyers adequate notice of a slip costs nothing extra, while failing to costs a flat $1,500 on every affected agreement regardless of how short the actual delay turns out to be.
A builder's Firm Closing Date passes and the home doesn't actually close for another 40 days. The builder also gives the purchaser only 3 days' notice of the new date, short of the required 10. Compensation runs $150 × 40 days = $6,000 in living expenses, plus the flat $1,500 inadequate-notice payment, for $7,500 total — which lands exactly on Tarion's per-agreement maximum. Past that point, further delay costs nothing more under this specific coverage, though it does nothing for the relationship, and other warranty heads such as financial-loss coverage can still apply on top of it.
See also: The one, two and seven-year warranty tiers · Conciliation on a warranty claim · Using AI for Tarion warranty claims.
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