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.
STOPPING FORECLOSURE In Alberta – You Have Options.
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!
WILL YOUR BANK NOT RENEW? WOULD YOU LIKE TO SELL YOUR HOME ON YOUR OWN TERMS?
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:
- 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
|1||Demand Letter||10-day notice period||Letter is sent with 7 to 10 days’ notice period. This may be sent by the lender or the lawyer. (Demand letter is not a legal requirement in AB, can be 7 to 10 days, or no demand notice.|
|2||Statement of Claim||20-day response time||The property owners have 20 days to respond. Most lawyers will place a Certificate of Lis Pendens on the title. As a property owner, if the intention is to sell, much negotiation power is lost with any potential buyers. A simple title search will indicate that the property owner is in a position of financial hardship.|
|3||Appraisal ordered||within the 20-day period after Statement of Claim is issued||Ordered after service of Statement of Claim. Homeowner is best advised to give access to appraiser to the home: the better the value, the more time the homeowner will be granted in the foreclosure.|
|4||Affidavit of Default||Send to property owner soon shortly|
after the 20-day response time for the Statement of Claim
|Send to property owner. Will state the balance of the arrears and include a copy of the appraisal.|
|5||Notice of Motion for Foreclosure relief||One of the following will occur:|
|i.||Notice of Motion for Order Nisi||Lawyer asks the court to set a Redemption period. Redemption period generally ranges from 1 day to 6 months. The judge decides this based on how much equity there is in the property. Once the redemption period has expired, the property can be advertised for sale.|
|ii.||Notice of Motion for Title, Possession and Deficiency Judgement (Rice Order)||If there is very little equity, the Lender will apply to take title to the property. If approved, the property needs to be vacated within 30 days.|
|iii.||Notice of Motion for Final Order for Foreclosure||If there is equity, and all advertising avenues have been exhausted with no reasonable offers. If approved, the lender will be granted title to the property.|
NOTES: Before any court date, the property owner must be given notice of the court date, as well as what action the lawyer is seeking for the court to decide on. The homeowner has absolute right to be in court, and to speak with the judge and understand what is being decided upon, and what the decision is.
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.
At times, bad things happen to good people with good intentions. Foreclosure in Edmonton should be the last resort. An Edmonton foreclosure can be extremely damaging to your credit and your ability to purchase a home in the future.
Below is a Recap of the Foreclosure process in Edmonton:
- Statement of claim. This occurs after missing 3 payments on your mortgage. Your financial credibility is being questioned.
- 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.
- The bank will request to the courts to sell your home. Time periods will vary, but the most common redemption period is 6 months or less.
- 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.
- The Order for Sale must be served to the owner of the home.
- If the redemption period passes without the owners paying out the mortgage balance; including legal and arrears, your home will be sold.
In addition to the services provided and information on this website, we always recommend seeking Independent Legal Advice (ILA).
Things to do when facing foreclosure in Edmonton:
Act quickly! Procrastination not only wastes time, but costs you additional interest and legal costs that can be avoided. 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.
If you are facing foreclosure in Edmonton, Contact Amansad Financial to explore your mortgage options.
When people purchase a home, they do so with the intention of either living there for the medium to long term or making some upgrades and then selling it at a profit. No one buys a house with the intention of falling behind on the payments and ending up in foreclosure court. However, there are times when financial calamities hit. People lose jobs or get sick and can no longer make ends meet.
If you are looking at the prospect of foreclosure in Calgary, I believe that you should only lose your home if you have exhausted all other options – and there are far more options available to you than your lender may have indicated. Prevent Foreclosure Calgary! Foreclosure can destroy your credit for years, making you unable to buy another house later on.
Many choices are out there if you are behind on your house payments, even if you have reached the point where you can no longer afford to make them. Amansad Financial Services has worked with a variety of private funders in the past and knows the ins and outs of their regulations. All it takes on your end is a quick mortgage application and assessment of your financial situation for Amansad to help you come up with the best plan to move forward.
Just how can Amansad Financial step in and help you avoid that pending foreclosure? A whole wealth of other lenders is out there, and some of them might be ready to purchase your loan, effectively refinancing your loan and allowing you to get a fresh start. You might end up with a longer loan than you had, and you might have to pay a bit to get the new loan set up, but if you have already received notice that foreclosure has begun, you are facing the problem of having to pay for the entire house, as well as some other costs. If you are already under the gun of foreclosure, you need help and you need it now, and any refinancing option is better than losing your home. Amansad Financial has the relationships in place to put together some creative answers that other lenders do not have access to. When this process works, you end up with a refinancing approval to get the foreclosure countdown stopped, or it gives you an infusion of cash to stay afloat while you find someone to buy your home. With either solution you lack having that foreclosure on your credit report.
Action steps for people facing foreclosure in Calgary:
1. Statement of claim. This is a document that the lender has to serve you. If you miss three payments in a row on your mortgage, the lender has the right to question your financial status. Once you receive this document, you have 15 days to file a defense statement in rebuttal. If you fail to file the rebuttal, default judgment against you is likely.
2. Request for the ordered sale. The next step is that the bank goes to court asking for an order to sell your house. The court will set a specific time period to allow you to redeem the house for its full value, usually between three and six months.
3. Foreclosure sale. If the court orders the sale of your home, this takes place either through the MLS system or through the Court Tender process. When you get the paperwork with the order, you’ll see the timeline in your period of redemption, as well as the order to get an appraisal on the house so the lender can get an accurate valuation. If you do not pay out the total in arrears and legal fees by the end of the period, you lose your home to the sale process.
Stopping foreclosure in Calgary
When you face foreclosure, keeping a proactive approach is crucial to remaining ahead of the game. If you have only fallen 30 or 60 days behind, talk to your bank now about getting an extension. If you are assertive in keeping this communication line open, you can avoid this entire process in the first place. Amansad Financial can also help you find refinancing without foreclosure, which means you get a new loan without the stress of dealing with foreclosure. If you already have entered your redemption period, though, matters are already beyond your control as far as dealing with your original lender. Call Amansad Financial today to find out how we can help with your situation.
If your facing foreclosure in Calgary, Fill out our Fast Pre-Qualification form – You Have Options!