Quebec Foreclosure Process starts when a mortgage holder is in default of payment. The mortgage lender issues the home owner a 60-day notice warning them that their mortgage is in default and that their property will be seized if they do not remedy the situation. In most cases, it is assumed that the property owner will find a way to repay the amount owed.
Quebec Foreclosure Process
There are certain Quebec foreclosure process that a mortgage lender or bank must follow before they can start a home foreclosure. The first step in the Quebec foreclosure process is that a mortgage lender must apply to a court for an order. If there’s a Supreme Court Registry in your local town or city, the mortgage lender is usually required to start the Quebec foreclosure proceedings there, unless you agree to file the papers at a different location.
Once the court has the filed order a “petition for foreclosure” will be sent to you this is a copy of the lender’s foreclosure application to the court. The mortgage lender can also ask the court to sue you for any amount money that you may still owe on the mortgage.
Right of Appearance
As the home owner in Quebec you have the right to request an Appearance form from the court registry. The Appearance form must be completed and filed at the court address shown on the petition. The Appearance form requires the mortgage lender or any other person to notify you of any further steps or filings that relate to your property. If you don’t file the Appearance form, the mortgage lender can proceed without informing of the legal proceedings or the status of the foreclosure. Once the Appearance form is filed, you will get a document called a “Notice of Hearing”, which tells you when the lender will ask the judge for an order to start the foreclosure process.
Quebec Foreclosure process Redemption Period
The home owner is given time to “redeem” the mortgage by paying the full amounted owed, plus any interest, costs and taxes to the lender. This time period is called the “redemption period” and it’s length can vary but usual time for this is about 6 months, you can also ask the judge for a longer period of time to get the money required to pay off the mortgage or sell your home. The Quebec foreclosure laws are designed to give the home owner every chance to redeem the mortgage.
Avoiding Quebec Foreclosure process
If you face a potential foreclosure in Quebec, you should take immediate action as per following recommendations from Canadian real estate investment experts.
Contact your lender immediately. Foreclosures are an expensive and time consuming process, so it’s likely your lender will be eager to avoid it if there is a better way for them. Communicate directly with the mortgage lender with your particular situation. You both will find a better resolution than anyone else.
Forbearance :Depending on your situation, here are some options you or your lender might suggest: Ask for extra time to make up your payments Lenders might agree to wait before taking legal action against you and let you work out a repayment plan that is affordable for you
Mortgage Modification : Every mortgage lender or bank is different. Ask the mortgage lender to change the interest rate to a more manageable level. A lender might also extend the amortization period which will lower monthly payments.
Avoiding Quebec Foreclosure options
Increase the Mortgage amount : Some lenders may offer to spread out missed payments over a longer term. Re-calculate and refinance the mortgage If the home owner have enough equity and meet the lender’s requirements, the lender may increase your mortgage amount.
Consolidation: Home owner may also refinance by wrapping other debts into your mortgage By putting your 20% – 30% interest debts like credit cards into your mortgage. Paying them off, and increasing the mortgage amount, you will decrease your overall monthly debt load. As long as you’re pretty sure you can keep up with payments, it’s not a bad option.
Mortgage Default Insurance If you happen to have hi ratio mortgage on your home then you may get some temporary protection from foreclosure and power of sale in Canada. Default mortgage insurers carry programs that help struggling homeowners to temporarily pay interest only, or to forgive some of your payments.
Canadian private hard money lenders: Consider getting secondary mortgage from a Canadian private hard money lender. They do not care about your credit score, income. All they want to have AACI appraisal to see that there is enough equity.
Family and friends: Asking help from family and friends can be quick solution too. Mom and Dad's bank can be the super choice.
Sell it for instant cash and fast closing : One of the best option is for the home owner is to sell their property to Canadian real estate angel investor for cash with fast closing. Save the hassle, legal cost, credit and downsize with pride.
Words of Wisdom
Words of wisdom from Canadian real estate investment expert, Navtaj Chandhoke "Most important for every home owner must have skip a payment plan built in their mortgage. Be aware of all the penalties due to default. One of the worst penalty is interest rate differential which can give you the shock of your life. The property will be foreclosed if the home owner is not able to repay the full amount that is owed".
Dealing with a looming foreclosure it not easy but if prepare yourself, get in contact with your real estate lawyer. Be cooperative as possible you can and will make it through the process. Knowing the Quebec foreclosure process professional real estate investors can help home owners and make money.