Anonymised, illustrative composite. A lender-required bacteriological test came back failed with two business days left on the financing condition, and the fix turned entirely on whether the condition could still be waived, extended, or used to walk.
At a glance
A buyer offered $498,000 on a rural southwestern-Ontario property served by a private well, with a five-business-day financing condition. As part of underwriting the mortgage, the lender required a standard bacteriological well water test — a routine requirement on rural files rather than anything specific to this property.
The lab result came back with bacteriological contamination two business days before the financing condition was due to expire, meaning the lender's requirement was not yet satisfied and the mortgage approval it was tied to could not close. The buyer's agent had to move fast: the source is direct that a bacteriological test many lenders require is separate from, and does not screen for, naturally occurring contaminants like arsenic or uranium, which matter in parts of Ontario with a known geological history — but this was a bacteriological result, not a chemical one, and bacteriological contamination is generally the more treatable of the two.
A condition under an Ontario APS resolves exactly two ways: it is fulfilled, or the protected party waives it. Both fulfilment and waiver have to be communicated in writing and delivered before the deadline. The moment the condition is waived, the agreement becomes firm and binding — whether or not the thing the condition was protecting the buyer against was ever actually resolved. Waiving a financing condition with an unresolved lender requirement attached to it would have bound the buyer regardless of whether the lender ever actually funded.
Well water quality and a septic system on the same rural property are related in practice but assessed and disclosed separately — a clean septic history says nothing about the well, and vice versa. The buyer's agent kept the two issues distinct rather than assuming one clean result implied the other.
The seller, asked directly, said the well had never failed a test before and had no knowledge of a nearby contamination source. That mattered for a different reason than the retest itself: the general rule on a rural Ontario file is that a seller does not have to volunteer an exhaustive report, but cannot conceal or misrepresent a known, latent defect. A well is a good example of why that distinction matters — it is almost entirely underground and out of view, and a buyer's own inspector cannot assess its water quality without a specialised test. Groundwater itself is treated in Ontario as a public resource rather than something the property owner controls outright, and under the Ontario Water Resources Act a Permit to Take Water is required above a prescribed volume — though a single-household domestic well is typically exempt from that permit requirement, which is a separate question from whether its water is safe to drink.
Purchase price $498,000. Financing condition: 5 business days, with 2 remaining when the lab result arrived. Retesting after a standard remedial step — shock chlorination of the well — typically needs at least several days to a couple of weeks before a retest is meaningful, since the chlorine has to be flushed and the water re-sampled; no fetched Canadian source publishes a standard cost for that remedial step or the retest itself, so none is quoted here beyond noting it is a common, comparatively low-cost intervention rather than a structural repair.
The financing condition's own deadline mechanic decided the shape of the buyer's options: fulfil it, waive it, or let it lapse. Because a condition protects the party it names — here, the buyer, through the financing condition — that party can walk away without penalty if it is not met, provided nothing has been waived and the deadline has not passed.
With two business days left, the buyer's lawyer and the seller's lawyer signed a short written amendment extending the financing condition by ten business days specifically to allow shock chlorination and a retest, rather than forcing an immediate waive-or-walk decision on an incomplete picture. The retest came back clean, the lender's requirement was satisfied, and the buyer fulfilled — not waived — the financing condition on the strength of the passed retest.
Had the seller declined the extension, the buyer's only real options at the original deadline would have been to walk under the still-unfulfilled financing condition, or to waive it blind and accept whatever the well's actual condition turned out to be — the same blind-waiver risk that decided a different file entirely on its own terms. See also the well and septic certification glossary entry and a septic system that was never permitted.
A 30-minute call is enough to tell you whether AI pays for itself here.
