Is it Hard to Defend Your Home Against a Foreclosure in Canada?

The portrayal of Canadian real estate, especially to outsiders who watch estate shows on TV may at times contain a bit of exaggeration. When one is experiencing an actual foreclosure, for instance, the rules will be a little more challenging to go around, and it can be very difficult to understand how to defend yourself. However, it is possible to save a house which has already gone into foreclosure, and this possibility depends on a number of factors.

 

Rarely Discussed aspects of foreclosure in Canada

It is true that lenders can start a foreclosure process as soon as you miss your first payment, however, in most cases, the lenders do not do this. The reality is that a foreclosure is an expensive and time-consuming process and this means that it is in the best interest of both the lender and you as the owner of the home, to keep the mortgage payments updated. Most of the times, they will try to gain your attention with the aim of settling at an alternate payment plan that will help you avoid foreclosure. As a matter of fact, most parts of the country do not even go through with the foreclosure process. Check whether your state allows for power of sale, where you take over the property and try to look for a buyer within the shortest possible period.

 

The steps that will be followed in foreclosure

There are steps which are followed in the foreclosure process for states which do not allow the power of sale process. It is the lender who starts off the process by filing a document known as a statement of claim. You as the homeowner will be served with this document, which makes you the defendant.

 

Replying to the claim

After you have been served with the statement of claim, you will have 20 days within which you can reply to the claim. There are two ways that you can react, either give a demand for notice or give a statement of defense. It is important to reply to this claim because when you fail to, the lender may claim you are in default, which will lead to the court concluding that you have decided not to fight the foreclosure process. Whether you react to this statement or not, the lender will still be needed to file a number of statements to try and recoup their money. The court can either issue a redemption order or an order of foreclosure, depending on whether they believe you are capable of making the mortgage payments or not.

 

The Canadian real estate market in 2018

According to Canadian Real Estate expert, Hilliard MacBeth, 2018 is the perfect time to buy real estate property. The first quarter of the year has already predicted that interest rates and mortgage rates are expected to rise this year. If you are thinking about buying a home or getting mortgage refinancing, you need to consider the following factors:

 

· There is a test which was introduced and is mandatory for all home buyers taking a mortgage from the lenders. The test, known as the OSFI stress test, is aimed at figuring out whether prospective buyers can actually afford to repay their mortgages comfortably.

 

· There is a high population of millennials looking forward to owning their first home soon, and this demand could push the prices up.

 

· There has been a lot of immigration growth, which ultimately affects the cost of housing.

 

With these factors in mind, it will be easier to decide the type of home that you can afford and to plan appropriately for it. As long as you start prepared, you will not have to worry a lot about a possible foreclosure.


Caitlin Weaver
Sales Representative
(416) 890-3017
cweaver@chestnutpark.com

Chestnut Park Real Estate Limited, Brokerage
1300 Yonge Street, Suite 100
Toronto, ON M4T 1X3

(416) 925-9191