Whether you are a Bank, mortgage broker, Canadian real estate investor or a home owner, if you are involved with a mortgage in default, you should know the foreclosure process in Alberta. Alberta foreclosure is the process the lender uses to get the money that you should have paid earlier back if your mortgage loan has been defaulted. Call 1-416-409-7300 for the Alberta foreclosure help you need. We have been serving Canadians in need since 1981. One of the main differences of the foreclosure process in Alberta, compared to other provinces, is that the Master in Chambers of the Court of Queen’s Bench of Alberta decides who the foreclosure property will be sold to, and for what price.
Foreclosure process in Alberta
The most prevalent default is the non-payment of mortgage payments. After one missed payment, the foreclosure process in Alberta can legally begin. But other reasons can cause the Alberta foreclosure process to start as well.
Acts of default under a mortgage may include:
- Failing to make mortgage payments,
- Allowing significant damage to the property,
- Failing to insure the property,
- Failing to pay taxes or condominium fees on the property.
The home owner pays All costs in a foreclosure action. Costs can include process servers, appraisers, lawyers, property managers, repairs etc… If there are any costs incurred, it is added to what the home owner owes. This is important as a Bank or a lender (or insurer) can pursue a deficiency judgment in certain circumstances. CMHC and other insured mortgages are two examples of what commercial property owners can face when in foreclosure. The lender can garnish wages, take payments from the borrowers assets etc for the amount owing in the mortgage.
When someone defaults, the lender contacts Alberta Foreclosure
Bank or lenders will usually initiate communication on a first missed payment. Some Bank or lenders will call while others will mail a letter notifying you of the missed payment. The foreclosure process in Alberta will end if the missed payment can be paid immediately. Alberta Property owners should not ignore the communication from the lender. If there is a situational issue, some mortgages have provisions for a single missed payment. The lender will send a demand letter usually after 2 missed payments due to non sufficient funds. These have a cost to them from $150 all the way to $500 in the Alberta foreclosure process.
This letter can even be sent by a collections company or lawyer. This letter will always say that the foreclosure process in Alberta will start if payments cannot be made.
In Alberta, Alberta foreclosures are started by way of a statement of claim.
The statement of claim is filed in the Court of Queen’s Bench. Once this stage of the foreclosure process in Alberta is started, the home owner will be liable for more significant costs as most lawyers provide for a borrower to pay all costs associated with the foreclosure process in Alberta. A notice on the title to the property will be filed by the lawyer for the bank. This notice will let other people who have secured on the title know that the foreclosure action has been started.
To pay the costs that they owe, in Alberta the home owner has a right to redemption. Until the court makes the final order, the home owner can pay the arrears, or in some cases, make arrangements to pay the arrears.
Alberta Foreclosure has very few defenses. This is not commonly used because it is very expensive, and there is no defense unless there is an error in the amounts owed or paid. If the borrower does not owe a lot of money, this is a defense. The amount of legal fees etc. can be disputed.
To be kept up to date on the Alberta Foreclosure Process, the borrower can demand a notice. If the home owner tries to sell the property, the bank or lender has to go through all the foreclosure steps and the Alberta foreclosure will occur.
This is a common choice that Alberta home owners make. This allows a Bank or a lender to note the borrower in default. They will be noted in default once the notice period has passed. On the statement of claim it will state how much time the home owner has to respond. The bank or lender can skip the rest of the process and jump straight to the end if this happens.
A quit claim is when the home owner gives the title to the bank or lender. The home owner is highly recommended to obtain legal advice if they are considering a quit claim as they may lose rights and it may have continuing financial repercussions.
This is another situation where the home owner should talk to a lawyer about the legal consequences of this action.
It has many repercussions but it may allow the home owner to live in the home longer
This is the time that the court allows the home owner to pay back the arrears and bring the mortgage current.
The time will vary from court to court. The redemption period and how long the hoe owner can stay in the home is determined by many factors. The single biggest factor is the amount of equity in the property.
This is the step in the Alberta foreclosure process where a home is put on the market for sale. Many methods of sale have been used in Alberta over the years. A tender notice in a court house, or newspapers, listing with a realtor or on auction sites are some of the common methods.
The Master in Chambers of the Court of Queen’s Bench of Alberta have a wide discretion in determining how a property will be sold in a foreclosure.
All agent fees are paid by the home owner. Offers are all presented to the Master in Chambers of the Court of Queen’s Bench of Alberta. It is the Master in Chambers whom decides if an offer is fair and if it should be accepted. The sale proceeds are used to pay back all debt(s), in priority order, on title. If funds remain, they are given to the home owner.
The bank or lender may take the property and it is called an Order for Alberta foreclosure. It is a different process than a judicial sale. The Alberta foreclosure order may lead to a deficiency judgment.
Please call/text 1-416-409-7300 if you are facing foreclosure in Alberta or if you want to learn how to buy pre-foreclosure properties in Alberta. You can attend our LIVE seminar and eye witness training.
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