If you are facing foreclosure in BC, you may be wondering what to expect next. The foreclosure process is a lengthy and costly one that requires court intervention.
It’s a common occurrence in Canada but there are many ways to avoid foreclosure. If you fall behind on your mortgage payments, there are several options that can help you stay in your home and avoid a foreclosure.
1. Demand Letter
A demand letter is a legal document that tells the homeowner that their mortgage is going to be foreclosed on if they do not pay what they owe. It is the first step in the foreclosure process and gives the borrower a chance to make up the mortgage payments before the lender takes them to court.
If you fall behind with your mortgage payments, it can be very frustrating to see your home go into foreclosure. It can also damage your credit. However, there are many ways to fix this problem.
You can work with your mortgage lender to come up with a repayment plan that will help you get caught up and keep your home. You might also be able to sell the property before it goes into foreclosure.
Your best bet is to contact a BC mortgage broker who can offer you options that may allow you to stop the process of foreclosure, get back on track financially or even find a buyer for your property. These private lenders can offer a variety of 1st or 2nd mortgages that could give you a better chance of staying in your home.
There are several steps that must be approved by the BC Supreme Court before a lender can begin the foreclosure process. This includes obtaining an Order Nisi, a redemption period and an Order of Sale.
Once the Order Nisi is obtained, the lender can start advertising the property and collecting offers from interested parties. Once a buyer makes an offer, the court will review it and decide whether or not to accept it.
The lender may also ask the court for an Order Absolute, which is a final order that allows them to take ownership of the property and sell it. An Order Absolute can be obtained if the mortgage debt cannot be fully paid under a power of sale, or if there is insufficient equity in the property to cover the debt.
If you have a serious issue that needs to be addressed, the best way to get your point across is to put it in writing and ask people to sign on. For example, if you’re a member of an environmental group and you want to protect your local community’s parks from being demolished, you can petition the city government to reconsider their decision.
Petitioning is a form of political activism that originated during the reign of Edward I of England and became a common method for protests and requests to governmental authorities and individual public office holders. It has been used in a number of notable instances, including the petition that prompted Nelson Mandela to be released from prison during apartheid in South Africa.
A petition is a written request for a judge to grant an order or verdict. Its basic requirements vary depending on the court where the petition is filed but in general, the petition must allege certain things and provide specific examples to support your argument.
In BC, when your lender is trying to recover the money that you owe them, they’ll start by filing a “Petition for Foreclosure” with the court. The petition will detail what they want the court to do and include a “redemption period.” This is usually six months, although it can be longer.
The court will also set a hearing for the petition. This means that the court will hear arguments from both sides of the case. Then, a decision will be made about what happens next.
In the event that you receive a foreclosure petition, it’s important to respond within 21 days of receiving it and file an affidavit with the court. This will ensure that you receive notice of all the hearings and help prevent any omissions or misunderstandings between you and your lender.
3. Order Nisi
If you are unable to pay your mortgage, the lender can take your property through the foreclosure process. This is a complicated process that can take months or longer to complete.
The foreclosure process in BC starts with the Lender filing a “Petition for Foreclosure” asking the court to start the procedure. This petition is served on the borrower and anyone living at the property, including any guarantors if there are any.
Once the petition has been filed, the borrower has 21 days to respond and a hearing is scheduled for the issuance of an order Nisi. The order nisi will state whether the mortgage is valid and enforceable, grant judgment against the mortgagor, if disputed, and set out a redemption period of about 6 months to redeem the mortgage by paying back the entire amount owing plus interest, costs, and taxes.
After the redemption period ends, the lender can apply for an order absolute, which gives the lender full possession of the property. This order is only granted when the property is worth less than the borrowers’ mortgage debt.
This is not a common practice in BC and it can significantly reduce the value of the property sold under the Foreclosure process. It is also difficult to get land title offices to participate in this type of sale.
If you are unable to pay your mortgage, talk to the lender about getting on a payment plan that will allow you to make up missed payments over a short period of time. If you can, this can help prevent the foreclosure from taking place in the first place.
4. Order of Sale
An order of sale is a court order that approves the sale of a property. The process can take months, but in some cases it is quick and easy.
During the foreclosure process, a lender may apply to the BC Supreme Court for an order of sale. This allows the lender to list and sell the property. This is often done to help them recover the money that they lent out to the borrower, or to pay other debts registered against the home.
It is important to understand that in a sale conducted under an order of sale, the sale price can be lower than what the original owner paid for the property. The purchaser is buying the property “as is, where is” and cannot make any representations or warranties about the state of the property.
The sale of a foreclosed property is a very complex and lengthy process. It is not recommended that you purchase a foreclosure property without the assistance of a lawyer.
In the majority of cases, the lender will have to obtain a number of court orders in order to seize and sell the property. This is because there are often many charges and other interests that are in priority to the mortgage.
For example, if the loan was secured by a mortgage insurance policy, the government agency (CMHC or Genworth) will take possession of the property and market it conventionally. The original borrower and any other mortgage holders who have equity in the property will lose the value of their equity in the sale.
5. Notice of Sale
The notice of sale is the first legal step in the foreclosure process. It is served to borrowers by the foreclosing lender and it is usually given for a period of time, which varies by province.
The amount of time given depends on the laws in your province and it can take as little as 4 months or as long as a year to complete a foreclosure. This depends on a number of factors, including what the lender is looking for.
Generally, it is not until 2 or 3 months after you stop paying your mortgage that the lender starts the process of foreclosure. This is because banks do not want to start the process until they have a good idea about your financial situation.
However, if you do fall behind on your payments, there are several things that you can do to save your home from being foreclosed on. These include:
1. File a response to the petition (supporting affidavits) within 21 days of receiving it.
2. Deliver two copies of your response to the lender.
3. File an application for Order Nisi with the BC Supreme Court registry – this gives the borrower a certain amount of time to redeem their mortgage.
4. Lender then files a Petition for Foreclosure with the BC Supreme Court – this starts the legal proceedings.
5. The borrower is given a chance to respond in the Order Nisi Hearing.
During the hearing, the respondent must answer questions about why they are behind on their mortgage. If you are struggling financially, this is a great opportunity to make a case for why you need more time to get your finances in order and find a new place to live.
Among many other things, David A. Grantham is a contributing author to UmassExtension West Vancouver Blo. He is a renowned expert on real estate in BC.
Born in North Vancouver, Louisiana, Dr. Grantham grew up in Lower Lonsdale. He then went on to complete his business degree at the University British Columbia. As of this writing, Grantham has completed over 100 projects, including the development of a high rise building in Vancouver.
He is a husband, father, son, brother, and friend. He was a dedicated outdoorsman and enjoyed sports such as hunting, fishing, scuba diving, and snow skiing. His wife, Alison Grantham, and their two daughters survived him. He is survived by his wife Alison Martin Grantham and two daughters.