Can a strata corporation borrow money?
A two-million-dollar envelope repair cannot be paid from a reserve fund holding two hundred thousand. Owners face a large special levy, or the strata borrows and repays over time. The Act allows it, on conditions.
Last reviewed November 10, 2026, against the current Strata Property Act, Strata Property Regulation and Standard Bylaws on BC Laws.
The short answer
Yes. Under section 111 of the Strata Property Act, a strata corporation may borrow money needed to exercise its powers and perform its duties, after approval by a 3/4 vote at a general meeting. It may secure the loan by a mortgage of property other than common property, by an assignment of unpaid strata fees or special levies, or by a negotiable instrument. The loan is repaid through strata fees or a special levy.
What section 111 allows
- The strata may borrow money required by it to exercise its powers and perform its duties: typically major repairs.
- Borrowing must be approved by a resolution passed by a 3/4 vote at an annual or special general meeting, before the loan is taken.
- It may secure repayment by one or more of: a mortgage of property other than common property, an assignment of unpaid strata fees or special levies, or a negotiable instrument.
- It must not mortgage common property (section 81).
Because the building's common property cannot be mortgaged, strata lenders rely mainly on the strata's legal power to collect fees and levies from owners, backed by its lien rights.
How a strata loan works in practice
- Define the project and cost, ideally from an engineer's report or the depreciation report.
- Get loan proposals. Some banks, credit unions and specialist lenders offer loans to strata corporations. Compare rate, term, fees, prepayment terms and reporting requirements.
- Draft the resolutions with a lawyer: approval of the work and its funding, approval to borrow, and approval of how the loan will be repaid.
- Give notice with the full wording, since these are 3/4 resolutions (section 45).
- Vote. Lenders usually want the counts and a certified copy of the minutes.
- Sign. Council authorizes signatories by motion.
- Repay through the budget or a levy, and report the balance in each year's financial statements.
StrataMinutes can take this off your plate. Money decisions are the ones owners, buyers and the tribunal read most closely. Have the minutes prepared for you, with every motion and vote count recorded. Your first month is free.
Two ways to repay
| Method | How it works | Vote |
|---|---|---|
| Through strata fees | Loan payments are a budget line. Every owner pays monthly by unit entitlement. | Budget approved by majority each year |
| Through a special levy | A levy is approved for the project. Owners may pay their share up front or over time, with the loan covering those who pay over time. | 3/4 |
Many lenders prefer a special levy resolution because each lot's share is fixed and can be liened if unpaid. Some arrangements let an owner pay their full share at the start and avoid interest. The details depend on the lender. A special levy resolution must state the purpose, total, method of division, each lot's share and due dates (section 108).
Loan or special levy?
| Special levy, paid up front | Strata loan | |
|---|---|---|
| Cost | No interest | Interest and fees |
| Impact on owners | Large lump sums | Spread over years |
| Speed | Money arrives as owners pay | Funds available at once |
| Owners who cannot pay | Must find their own financing | Covered by the loan |
| On sale | Unpaid instalments follow the Act's rules | Loan stays with the strata. Buyer inherits the payments. |
| Disclosure | Appears on the Form B | Appears in financial statements and minutes |
Neither is free. A levy asks owners to find the money now. A loan costs more overall and shows up to buyers as a liability of the strata. A properly funded reserve avoids both, which is the point of the depreciation report.
Short-term borrowing between funds
A strata may also "borrow" internally in one narrow way: a loan from the contingency reserve fund to the operating fund to cover a temporary shortage, repaid by the end of the fiscal year, with owners informed (Regulation 6.3). That is not borrowing under section 111 and needs no 3/4 vote. A bank line of credit or overdraft, however, is borrowing and does.
Selling a unit when the strata has a loan
The loan is the strata corporation's debt, not a charge on individual titles. A buyer takes on the fees or levy instalments that fall due after they become owner. Sellers should expect buyers and their lenders to read the minutes and financial statements closely, and the Information Certificate (Form B) discloses approved special levy amounts still to be paid and other matters the form requires. See special levies when selling.
What to record
Sample resolution (3/4 vote): BE IT RESOLVED by a 3/4 vote that The Owners, Strata Plan VIS 1234, under section 111 of the Strata Property Act, borrow up to $1,400,000 from Island Credit Union on substantially the terms set out in the term sheet attached to the notice of meeting, for the purpose of the building envelope remediation approved in Resolution 2, to be repaid from the special levy approved in Resolution 3, and that any two council members be authorized to sign the loan documents on behalf of the strata corporation.
Keep the loan agreement with the strata's contracts, which are records under section 35.
Questions councils and owners ask
Can a strata corporation get a loan in BC?
Yes, if approved by a 3/4 vote at a general meeting under section 111.
Can a strata mortgage the building?
No. The strata must not mortgage common property. Lenders rely on assigned fees and levies.
Who repays a strata loan?
The owners, through strata fees or a special levy, in proportion to unit entitlement.
Is a line of credit borrowing?
Yes. It needs the same 3/4 approval.
Does a strata loan appear on my title?
No. It is a debt of the strata corporation, disclosed in its financial records.
A loan resolution must be recorded word for word
Lenders ask for certified copies of the minutes. StrataMinutes prepares them with the full resolution, the threshold and the count.
Free for 30 days, then $29 a month. Cancel anytime.
For a 30-lot strata, that is under $1 a lot each month. Have the strata pay: free council approval kit.
This page is general information for BC strata corporations, not legal advice. Your strata's own filed bylaws may differ from the Standard Bylaws. See the current text of the Strata Property Act and the Strata Property Regulation on BC Laws.
Related guides
Special Levies
The 3/4 Vote
Reserve Fund Spending Rules
Reserve Fund (CRF)
Depreciation Reports
Special Levies When Selling