Stop a Foreclosure in Ontario.
It Starts with Mortgage Arrears
If you are reading this article and are currently behind on your mortgage payments it is important to read on. You are at the most preliminary stage of mortgage default, and while it is still very stressful, it’s imperative to act quickly. Ignoring emails and phone calls is a sure way to escalate matters into more cost that you will be responsible for, and the risk of losing your home. We have a very successful track record of representing clients who are struggling with mortgage arrears. Our approach consists of communicating with your mortgage lender, discussing a tentative game-plan, and in turn receiving cooperation and in some cases, time extensions. You should partner with a mortgage professional well-experienced in the mortgage default process. We assure you that experience makes all the difference in this respect.
What is a Foreclosure?
The Canadian judicial system provides legal remedies for mortgage lenders to enforce their security and retrieve their money from the borrower. The two most common processes are known as ‘foreclosure’ and ‘power of sale’. There are a few differences between the foreclosure process and the power of sale process but there is one significant difference. If your mortgage lender is awarded a foreclosure action against you and your property, the lender will receive title to your home. This not only means that you will lose your home but the equity as well! The foreclosure process in Ontario is also usually a timelier and costlier route to take for mortgage lenders.
What is a Power of Sale?
Most frequently mortgage lenders will pursue the power of sale process to enforce their security. If your mortgage lender is awarded a power of sale your home will be sold on the market. In a sense, a power of sale is the lesser of both evils as you will net the sale proceeds after the mortgage lender recoups their principal balance and all outstanding fees that were involved. Unfortunately, even though you are entitled to receive the remaining equity in your property, it isn’t quite this simple. Contrary to your understanding, there might be a wide variance between the principal balance and the total discharge amount. Every mortgage contains a schedule that outlines administrative and default fees. In most cases, these fees compiled are in the thousands. This is also before taking into account the lenders’ lawyer’s legal fees and disbursements. Furthermore, you might be forgetting about the real-estate sales commission plus harmonized sales tax. You might be shocked to find that you are receiving much less than expected. In extreme cases, your mortgage lender might be unable to sell your home for a sale price that supports their mortgage buyout. In other words, there might not be any money left for you.
Received a Mortgage Demand Letter?
At this point, you are likely aware that one or more of your mortgage payments have bounced or returned as non-sufficient funds (NSF). Your mortgage lender has sent you written correspondence in the form of an email or they have attempted to contact you by phone. You are human, after all, and you are nervous about the fact your mortgage is in default and unsure of what to do. You proceed with your busy lives and shortly thereafter receive a letter in the mail. You find that your mortgage lender or their lawyer has sent you a demand letter. This is usually a demand letter for non-payment of mortgage and will reflect a few charges. You will see the sum of the outstanding mortgage payment(s) and any other related fees including a demand letter fee. This letter will clearly state that legal proceedings will be brought against you for possession of your home unless payment is received by a relatively soon date.
Received Notice of Sale Documents?
At this point, the mortgage remains in default and payment was not received according to the demand letter that you received at an earlier date. Not only have you been asked to repay the sum that was listed in the demand letter but worse, the entire mortgage. Within the notice of sale document also lists a deadline for the total sum to be received, and another date indicating when the sale of your home will be initiated.
Benefits From Stopping a Power of Sale or Foreclosure
- Stop legal proceedings and prevent the sale of your home
- Prevent losing your hard-earned equity from a foreclosure
- Avoid the dreadful emotion associated with the entire process
- Take advantage of the equity of redemption period which allows you to stop legal proceedings
- Prevent embarrassing property visits from property management, appraisers, and the sheriff if an eviction is to happen
- Sidestep mortgage and legal fees that accumulate daily and erode your equity
- Avoid possible interest rate premiums due to a history of foreclosure or power of sale
DV Capital Corporation Helps By
- Leveraging their knowledge and experience to guide you through the power of sale and foreclosure process
- Communicating with all related parties and providing constant updates
- Works directly with mortgage lenders in Ontario that will lend up to 80% loan-to-value (LTV)
- Providing fast and flexible mortgage solutions to those experiencing financial hardship
- Knowing the correct approach to take to stop your power of sale or foreclosure
- Allowing homeowners access to their home equity to prevent legal proceedings
- Approving clients based on sufficient equity regardless of their income and credit
- Keeping clients in their homes
- Being able to, in most cases, offer prepaid mortgage payments, or fixed mortgage payments with custom term lengths