What to do with Power of Sale in Ontario

 

What to do with Power of Sale in Ontario

The Ontario lenders or bank will start   power of sale proceedings if the property owner is behind mortgage payments or the mortgage is due in full. There are several other reasons where the lender can exercise power of sale as well. The lender wants to recover their investment by selling the property at fair market value.

Most of the properties of power of sale listings on multiple listing services (MLS) are sold at fair market value by licensed realtors of Ontario. By no means they are considered fire sale or at bargain prices. But the lender and bank will sell power of sale properties in Ontario “ as is” and “where is” with no warrenties.

What to do when you are facing power of sale? The options are very limited but the rights of property owner and the lender are protected by Ontario mortgage act. Let us explore options for the property owner facing power of sale.

Sale by property owner

In the interim period, the property owner could continue to market the sale of the property by hiring a realtor or by themselves privately. Usually the property owner will be able to sell and save money if the property is marketed at fair market value.

Selling the property to a investor

The property owner can call investors and sell it for cash with fast closing. This works if the professional real estate investor is able to come up with the cash and close the deal really fast. Sometimes the Ontario lawyers require more time. But the property owner can assist them to gather all information required to close it swiftly.

Lenders proceedings too quickly

If the Lender or bank issued a Notice of Sale too quickly, the proceedings may be a nullity. This could arise if demands for full payment were made and the time limit in the demand had not expired. In such cases, the mortgagee would require a Court Order allowing the power of sale proceedings to take place.

Pay up Arrears and Costs

Most of the time, the Lender or bank will require payment of the entire balance outstanding. Under the Act, the property owner can simply pay up the arrears and costs. If that takes place, then the mortgage is back in good standing. The enforcement proceedings of power of sale are at an end.

Pay arrears & costs in court

In some cases, the Lender or bank will have instituted legal proceedings including an action for recovery of possession of the property. If that is the case, the property owner still has the right to pay up the arrears and costs as well as $100 for security, and the proceedings will be stayed. The accelerated principal need not be paid. If judgment is not been recovered, the action will be dismissed. 

Refinancing

This is very common recommendation by Ontario mortgage brokers and their agents. Low income/credit score/arrears/equity can be challenging to refinance. Banks and other lenders may not consider since the property owners are facing power of sale in Ontario.

Finding a partner/Joint Venture

The property owner who is going through the proceedings of power of sale in Ontario can find a joint venture partner. The joint venture partner can inject some cash for partial ownership. This strategy requires expertise and great amount of knowledge.

Request for Information

The property owner is entitled to certain information from the lender or bank including the amount of the accelerated principal. Upon receipt of the request, the lender or bank is obligated to respond within 15 days, failing which no further proceedings may be taken. If the lender or bank fails to respond without a reasonable excuse or, if the response is incomplete or incorrect, any rights that the lender or bank may have to enforce the mortgage shall be suspended until the lender or bank has complied.

Requisition an Assignment

The property owner as well as all other creditors is entitled to an assignment of the mortgage upon payment in full of the principal, interest and expenses. The right in favor of each party is separate and independent of one another. The lender or bank is obligated to reply and comply with such requests.

Technical Issues

The power of sale notice must comply with the contract and the Act. If there are any technical or legal issues they should be raised at once and rectified by the lender or bank. Courts will usually respond to such issues and deal with the matter equitably. The property owner might be awarded costs and additional time to pay.

Injunction by courts

On fair and equitable grounds the property owner will be awarded an injunction by the courts. This stops the proceedings of power of sale. One condition is the mortgage payments must be kept up to date until final disposition. This will not work if the property owner has no hope of refinancing.

Partial Payments

In many cases, the property owner will have made a partial payment. This frequently occurs without the active participation of either party. The lender or bank issues the Notice, and the mortgagor’s regular cheque is cashed. This means that the proceedings will have to start over again unless the lender or bank specifically indicates that it will accept the cheque as a “partial payment only”, without staying its proceedings.

Cost of Power of sale proceedings:

The Act requires the lender or bank to set out its costs being claimed in the power of sale proceedings. Failure to do so can result in delay, or the Court failing to award costs. These are some of the steps that might be taken by the property owner can exercise their right to protect.

Seek legal opinion in writingSeek legal opinion in writing

The property owner shall always seek the legal help. When a property owner is facing power of sale in Ontario, one of the best options is seek legal advice in writing from a competent Ontario real estate lawyer.

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2017 Home ownership Down payment Assistance Program Windsor

2017 Home ownership Down payment Assistance Program Windsor

Disclaimer:

Details contained herein are for informational purposes only and are not to be relied upon as a comprehensive or precise representation of the program, its terms and conditions, or eligibility rules.

2017 Home ownership Down payment Assistance Program Windsor

The Federal and Provincial governments partnered to fund a Home ownership Down payment Assistance Program.

It is expected this round of the program can provide assistance to a limited number of households. Down payment assistance of 10% of the purchase price of an eligible home,

Up to a maximum of $20,850 is provided by a 20-year forgivable loan
registered on title as a second mortgage.

Applicant eligibility criteria include income and asset limits among other criteria. For additional information, please refer to the Program Information Sheet and sample Loan Agreement at the links provided below.

The program expires when program funds are depleted or on November 30, 2017, whichever occurs first.

2017 Home ownership Down payment Assistance Program Windsor

http://www.citywindsor.ca/residents/housing/pages/homeownership-program.aspx

Learn more about Canadian real estate grants at
www.GovernmentGrantsCanada.ca

Surplus Municipal Property for Sale City of Kawartha Lakes

The Council for the Corporation of the City of Kawartha Lakes
has declared a number of municipally owned lands
as surplus to municipal needs.
Surplus Municipal Property for Sale City of Kawartha Lakes
More properties are being added regularly.

Contact Realty Services

Tel: 705-324-9411 extension 1261 (Nikki Whaley)
Email: realtyservices@city.kawarthalakes.on.ca.

PLEASE NOTE:

All Surplus Municipal Property for Sale City of Kawartha Lakes listed below may be subject to the Planning Act process to amend Official Plan land use policies and/or zoning provisions depending on the potential purchaser’s intended end use. Any Planning Act applications changes required as part of a purchase are at the initiation and expense of the purchaser. The current timeline for this process ranges between 4-10 months depending on the requested change. Please satisfy yourself in regards to the current land use permissions of the property and the required timeline of your intended changes prior to making an offer. Any questions regarding Official Plan land use policies and zoning as well as process related questions can be directed to the Planning Division at 705-324-9411.

The hidden costs of selling your property in Canada

Beware; there are the hidden costs of selling your property in Canada you might not know about. Are you been thinking of selling your property and maybe moving into retirement living you’ve been checking out? Selling your property can be a very profitable affair, especially if you have had that piece of property all your life. That means you may have bought it at time when property was not very expensive and could be enjoying the appreciation, which has occurred over the years. However, there are hidden costs of selling your property in Canada involved in selling your property and before you list your property for sale, you might want to check out these costs.

Learn from Experts

Hidden costs to sell your sell your property in Canada are:

  • Are you going to sell your property through a real estate agent or try selling it on your own? The fee is approximately 6% plus taxes.
  • How much do you estimate it will cost to prepare your property for sale?
  • Do you know what would it cost to pay off your mortgage including penalties, discharge and other charges?
  • Are there any repairs or upgrades you need to do that would help sell your property?
  • Are you going to hire a professional to stage your property?

Staging is changing the appearance of your property to make it more appealing to potential buyers—for example, renting furniture for a room.

Clutter, Grime, and Odors. Deal with it…
Living in our homes, we get used to things and we like them that way. All the family photos and bowling trophies may be family treasures but to a buyer trying to imagine themselves at home, too much information is a turn-off.

Other hidden costs of selling your property in Canada

Closing costs

  • Legal costs
  • Realtors fee plus taxes
  • Insurance cancellation
  • Adjustments (property taxes, utilities, condo fees, etc.)
  • Mortgage  penalties & discharge fees
  • Moving costs
  • Hiring a mover or renting a truck
  • Packing materials
  • Hotel costs, if required
  • Disposing of Junk

Mortgage PenaltyMortgage Penalties

The prepayment charge for a closed, fixed-rate mortgage is usually the greater of:

  • three months’ interest on the outstanding balance of your mortgage, or
  • the interest rate differential (IRD): an amount based on the difference between two interest rates. The first is the interest rate for your existing mortgage term. The second is today’s interest rate for a term that is similar in length to the time remaining on your existing term. For example, if you have three years left on a five-year term, your lender would use the interest rate it is currently offering for a three-year term to determine the second rate for comparison in the calculation.

b2Mandatory Repairs

When you’re selling your property, especially if it’s an old one, chances are there are many things that need to be repaired or replaced. Perhaps that 1990s toilet needs to be revamped or the kitchen cabinets need to be changed. It’s easy to get carried away with repairs. Think about it, you’re finally getting around to all of those things that you were meaning to get done over the years. The list could include light switches, dimmers, painting, re-grouting, and while they sound small, it’s these little things that can easily turn into thousands of dollars, especially if you’re hiring an expert to do that for you.

What you need to do is to pay attention to the repairs that have a major visual impact and would affect the property value. For example, a new kitchen would excite buyers more than new room carpets.

At the end of the day, the more prepared you are, the smoother the process and the less expenses you will incur. It all comes down to clear thinking and a few calculations, to make sure the cost of selling isn’t eating too far into your well-earned capital.

Failing to Complete Disclosures. CAVEAT EMPTOR, BABY!
Being upfront about any issues with your home will save you time, money and face. You may not want to mention the time the firetrucks showed up or the time you flooded the basement.

When do you report a capital gain or loss?

Report the disposition of capital property in the calendar year (January to December) you sell, or are considered to have sold, the property.

Note

Regardless of whether or not the sale of a capital property results in a capital gain or loss, you have to file an income tax and benefit return to report the transaction (even if you do not have to pay tax). This rule also applies when you report the taxable part of any capital gains reserve you deducted in 2014.

  • A donation of securities to a registered charity or private foundation does not trigger a capital gain.

·         If you sell an asset for a capital gain but do not expect to receive the money right away, you may be able to claim a reserve or defer the capital gain until a later time.

Reporting the sale of your principal residence to Canada Revenue Agency (taxman)The hidden costs of selling your property in Canada

When you sell your principal residence or when you are considered to have sold it, usually you do not have to report the sale on your income tax and benefit return and you do not have to pay tax on any gain from the sale. This is the case if you are eligible for the full income tax exemption (principal residence exemption) because the property was your principal residence for every year you owned it.

Starting with the 2016 tax year, generally due by late April 2017, you will be required to report basic information (date of acquisition, proceeds of disposition and description of the property) on your income tax and benefit return when you sell your principal residence to claim the full principal residence exemption.

Are you aware of hidden costs of selling your property in Canada? What other costs should you be aware of when looking to sell? Have you sold your property in the last 5 years? We buy houses for cash with fast closing.