Alberta Foreclosure and how it works?

Alberta Foreclosure and how it works?

No matter who you are, if you are in the process of a mortgage that has defaulted, you need to know the process of Foreclosure in Alberta. Alberta foreclosure is about the legal steps that a Bank or a lender takes to recover arrears and principal on mortgage loan that is in default. If you need foreclosure help in Alberta please call 1-416-409-7300. We have been serving Canadians in need since 1981. In Alberta the  Master in Chambers of the Court of Queen's Bench of Alberta, which isn't the case in the rest of the provinces. They can also decide who the property is sold to and for what price.

How Alberta Foreclosure Process starts?How Alberta Foreclosure Process starts?

Canadians are most likely to default under a non-payment of mortgage payments.

After one missed payment, the Alberta foreclosure process can legally begin. But other reasons can cause the Alberta foreclosure process to start as well. Acts of default under a mortgage may include:

  • Not making mortgage payments,
  • Letting the property get significantly damaged,
  • Not Insuring the property
  • Not paying taxes on the property.

Who pays for the Cost of Alberta foreclosureWho pays for the Cost of Alberta foreclosure?

Alberta home owners pay all costs in a foreclosure. The foreclosure process costs can include property managers, repairs, appraisers, realtors, lawyers etc… All costs are added to what the home owner owes. It is very important as a deficiency judgement can be pursued by a bank, lender or insurer in certain circumstances. Commercial property owners can face Alberta foreclosure, CMHC or other insured mortgages. 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

On the first missed payment, the bank or the lender will start communicating. Other banks or lenders will call you, or mail you a letter notifying you of the missed payment. The Alberta Foreclosure process will end if the missed payment can be paid immediately. If the property owner is being contacted, they should never ignore it. For a single missed payment, some mortgages have provisions if it is a situational issue. Missed payments due to non sufficient funds (NSF) usually have a financial cost to them ranging from $150-$500.00.

Demand letter in Alberta ForeclosureDemand letter in Alberta Foreclosure

In the Alberta foreclosure process a demand letter is usually sent after the second missed payment.
 
This letter can even be sent by a collections company or lawyer. In all instances this letter will state that if arrears are not paid up, an Alberta foreclosure will be commenced against the land owner.

Filing of an Alberta Foreclosure ClaimA statement of claim starts the Alberta foreclosure process

The Court of Queen's Bench files this claim. Once this process has started the home owner will be liable for many more costs, as most lawyers make the borrower pay all costs related to the foreclosure process. The lawyer for the bank starting the action wills the file a notice on the title to the property. The foreclosure action has been started once this notice goes out, and it notifies all people who have a title on the property.

Bring the arrears up to date with Alberta ForeclosureBring the arrears up to date with Alberta Foreclosure

To pay the costs that they owe, in Alberta the home owner has a right to redemption.

Up until the final order is granted by the court, the home owner can end the Alberta foreclosure process by paying up the arrears or, in some cases, making payment arrangements to pay up the arrears.

Statement of defense Alberta ForeclosureStatement of defense Alberta Foreclosure

There are very few defenses to Alberta foreclosure. 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 amount of the appraised value if very low, this is another time when a borrower may file a defense. Legal fees can also be disputed.

Demand of notice Alberta ForeclosureDemand of notice Alberta Foreclosure

A demand of notice is a legal declaration that a borrower wants to be kept up to date in the Alberta foreclosure process. 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.

No Defense by home owner in Alberta ForeclosureNo Defense by home owner in Alberta Foreclosure

Unfortunately, this is a frequent choice the home owners facing Alberta foreclosure make. The bank or lender can note the borrower is in default. This will happen after the notice period has passed. The statement of claim will state how much time the Home owner has to respond very clearly. Effectively, this allows a Bank or a lender to jump to the end of the Alberta foreclosure process.

Quit Claim Alberta ForeclosureQuit Claim Alberta Foreclosure

If the home owner gives the title to the bank or lender, this is called a quit claim. 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.

Consenting to the Alberta foreclosureConsenting to the Alberta foreclosure

This is another situation where the home owner should talk to a lawyer about the legal consequences of this action. It may allow a person to stay in their home longer; however it can have serious repercussions.

Redemption Period Alberta ForeclosureRedemption Period Alberta Foreclosure

The Redemption Period is the time the court allows the home owner to pay back arrears. The time allowed but the courts will vary. The redemption period and how long the home owner can stay in the home is determined by many factors. The biggest factor is the equity in the property.

Sale ordered by the court Alberta ForeclosureSale ordered by the court Alberta Foreclosure

This is the step in the Alberta foreclosure process where a home is put on the market for sale.

Over the years, Alberta has used many methods of sale. Advertising by tender notice in newspapers, by tender notice posted at the Court House, actual on site auctions and listing the property with a realtor are just some examples.
 
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. Whether an offer is fair or not is determined by the Master in Chambers of the Court of Queen's Bench of Alberta. All debts on the title are paid by the sale proceeds. The home owner receives all remaining funds.

Order for Alberta foreclosureOrder for Alberta foreclosure

This is where the property is not sold but is transferred to the Bank or a lender in satisfaction of the debt. A judicial sale is very different. A deficiency judgement may be reached by an Alberta foreclosure order.

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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