No matter whether you are a borrower or lender, it is important to be familiar with the Alberta foreclosure process, which is the legal process through which a lender goes in order to recover the principal and arrears when a mortgage goes into default. Most frequently, this happens when a borrower fails to make mortgage payments. The process cannot legally begin until the borrower has missed one payment, although in practical terms it generally takes more than one missed payment to trigger the process. Other types of default exist, though, when homeowners do not carry required insurance for the property or fail to pay the homeowner’s association.
If you are a borrower who is headed toward an Alberta foreclosure, life is about to become even more expensive for you. You will end up paying all of the associated costs, such as bills from process servers, lawyers for both sides, and any other associated costs, all of which simply get added to your debt. In Alberta, lenders generally get in touch with you when you first miss a payment. Some lenders like to call first, while others send you an official letter. Whether you get a call or a letter, though, you should not ignore this. If your payment went NSF (not sufficient funds in your account), there is often an associated cost that runs between $50 and $150.
After a second missed payment, the lender generally sends out a demand letter. The lender can send this directly or through an attorney or collections company. No matter who sends it, though, this letter generally indicates that a Alberta foreclosures claim will be filed if the arrears are not taken care of. At this point, if you still haven’t gotten in touch with the lender, this is still a point where things are fixable. Communication is often the difference between getting an extension on your loan and heading to court. Things happen in the real world; people lose jobs, they have unforeseen medical expenses, and there are legitimate reasons why they fall behind. The sooner that you start communicating with your lender, the more likely the lender is to work with you.
STOP Foreclosure in Alberta
Once the demand letter comes, you have a few options in Alberta. The option that your lender will appreciate the most is if you repay the arrears. If you start communicating at the first missed payment, generally just getting that payment caught up is enough. Until the court grants an order of foreclosure, you can end the whole process by simply catching up on your missed payment or even (in some cases) setting up a payment plan to settle those arrears. Another option is what is called a statement of defense. This is rare, because unless the lender has made a mistake, there is no valid legal defense for failing to make mortgage payments. A third option is to file a demand of notice, which is important if you don’t think you can make up your arrears quickly. This keeps the lender from jumping the queue on any of the steps of Alberta foreclosures, which can make things last longer. It can also reduce your lender’s willingness to be flexible with payment terms on your arrears. A fourth option is a quit claim, which involves you yielding the title to the lender. Talk to an attorney, though, before granting this, as the financial consequences can be severe.
Your fifth option, of course, is to do nothing. This lets your lender place you in default and reduce the amount of time you have to make up your arrears significantly, so this is a bad idea.
So what do you do if you don’t have the money to make up your arrears, but you anticipate an improvement in your financial situation within six months to a year? Amansad Financial has helped out many people in your situation. We have a network of private mortgage lenders who can step in and cover your arrears. As long as you don’t need more than 65 percent of the L.T.V. of your property, our private lenders will take over your entire loan. In other cases, where you need a higher amount, the private lender may be willing to cover your arrears and allow you to set up a payment plan, effectively giving you a second mortgage. In either case, you end up escaping the foreclosure process, and the investor ends up turning a nice profit as well. Amansad Financial is set to help you join our list of happy clients, so get in touch with one of our Alberta foreclosures specialists today!
ARE YOU FACING FORECLOSURE in Alberta?
WILL YOUR BANK NOT RENEW? WOULD YOU LIKE TO SELL YOUR HOME ON YOUR OWN TERMS?
Stop Alberta Foreclosure – Mortgage Help
We believe that foreclosure should be the last resort in Alberta. A foreclosure can be extremely damaging to your credit and your ability to purchase a home in Alberta in the future. Many Albertans are not provided with all their options. Being a Mortgage Professional in Alberta that works with a variety of private lenders and other real estate professionals; a quick mortgage application and complete assessment can determine your best course of action. If your facing foreclosure in Edmonton, a Calgary foreclosure, or other Alberta location, we are here to help.
Mortgage Foreclosure Process
Things to do when facing an Alberta foreclosure:
- Facing Foreclosure You Have Options. Act quickly! Procrastination not only wastes time, but costs you additional interest and legal costs that can be avoid. Every day that passes reduces your probability of overcoming the foreclosure challenge. Additional costs can sometimes prevent you from getting out of your current situation.
- Allow me to try and find a suitable Lender that can provide you the right approval to stay in your home, or provide you cash flow while you sell you home.
- If lack of equity in your home prevents an approval, there are other creative solutions available through my network
Below is a Recap of the Foreclosure process in Alberta:
Stage 1: Statement of claim. This occurs after missing 3 payments on your mortgage. Your financial credibility is being questioned.
Stage 2: This statement of Claim must be served to the owner of the home. As an owner you have a 15 day period to file a statement of defence. If not completed, the next state occurs.
Stage 3: The bank will request to the courts to sell you home. Time periods will vary, but the most common redemption period is 6 months or less.
Stage 4: Order for Sale of the property is ordered by bank. An appraisal is also ordered. In addition, this step will detail the specific dates of the redemption period. How your property will be sold will also be determined; either by the Court Tender Process or via the MLS at the appraised value.
Stage 5: The Order for Sale must be served to the owner of the home.
Stage 6: If the redemption period passes without the owners paying out mortgage balance; including legal and arrears. Your home will be sold.
I always recommend seeking legal advice. As a mortgage professional in Alberta I have relationships and work with industry professionals that may have strategies that may help you in this trying time.