• The power of sale process allows lenders to sell a property without going through the court system.
• If a borrower defaults on their mortgage payments, the lender can initiate the power of sale process to recover the outstanding debt.
• Borrowers have the right to redeem their mortgage up until the time of the sale, so seeking legal advice early on can be beneficial.

In Ontario, if you have a mortgage on a property and you can't make your mortgage payments, your lender may sell your property to recover the money you owe them. This process is called power of sale, and it allows the lender to sell your property without going to court.

Here's what you need to know about the power of sale process in Ontario:

Notice of Sale

The power of sale process begins when your lender sends you a Notice of Sale. This notice will let you know that your lender wants to sell your property because you haven't been making your mortgage payments. The notice will also tell you how much you owe and how much time you have to pay off the outstanding amount.

It's important to note that your lender has to give you a chance to pay off what you owe before they can sell your property. This means that you may be able to avoid losing your property if you can come up with the money to pay your mortgage arrears and any other costs associated with the power of sale process.

Waiting Period

If you can't pay off what you owe within the time given in the Notice of Sale, your lender will have to wait for at least 35 days before they can sell your property. This waiting period gives you another chance to come up with the money to pay off your mortgage.

During the waiting period, it's important to talk to your lender and try to work out a solution. For example, you may be able to negotiate a new payment plan or find a way to refinance your mortgage. It's also a good idea to speak with a lawyer or a real estate agent who can provide you with advice and guidance.

Sale of the Property

If you're unable to pay off what you owe within the waiting period, your lender can then sell your property. They will use the money from the sale to pay off your mortgage arrears, any interest owed, and any other costs associated with the power of sale process.

If the sale of your property generates more money than is required to pay off your outstanding debt, you will receive the excess funds. However, if there are other parties with an interest in the property, such as other mortgage lenders or lien holders, they may be entitled to a share of the surplus funds.

If the sale of your property doesn't generate enough money to cover your outstanding debt, your lender may be able to pursue you for the remaining balance. However, in Ontario, your lender must obtain a court order to do so. The court will then determine if you're liable for the deficiency and the amount of the deficiency owed.

Remember, the power of sale process can be stressful and overwhelming, but you have rights and options. If you're facing financial difficulties, it's important to seek advice and support from professionals who can help you navigate the power of sale process and find a solution that works for you.