Facing Power of Sale? Know Your Options
You may have more time than you think
Missed mortgage payments, a renewal at a much higher rate, a private second mortgage coming due: it can happen to anyone. If you’ve received a Notice of Sale, act quickly, but don’t panic. In many cases, selling on your own terms before the lender does protects far more of your equity.
How power of sale works in Ontario
1Default.
Under Ontario’s Mortgages Act, when the mortgage includes a power of sale clause, the lender can serve a Notice of Sale once the default has lasted at least 15 days.
2Notice of Sale and the redemption period.
The lender must then wait at least 35 days after the notice before selling. During this period you can bring the mortgage back into good standing or pay it off.
3The lender sells.
After the redemption period, the lender can take possession and sell the home, usually “as is”. Legal fees, enforcement costs and any shortfall are charged to you.
Why selling yourself is often better
- You control the price and presentation. Lender sales are often priced to sell quickly, not to maximize your equity.
- Lower costs. Every week of enforcement adds legal fees and interest.
- Your plan, your timing. A firm sale agreement can persuade a lender to allow time for closing.
- Privacy and dignity. A normal sale looks like any other listing.
I work alongside your real estate lawyer and, where needed, a mortgage professional who can look at refinancing options.
Questions people ask
How long does a power of sale take in Ontario?
When the mortgage contains a power of sale clause, the lender can serve a Notice of Sale after 15 days of default and must wait at least 35 days after the notice before selling. In practice the whole process often takes several months, but it can move faster.
Can I sell my house after receiving a Notice of Sale?
Often, yes. Selling during the redemption period and paying out the mortgage on closing is usually better for your equity than a lender-controlled sale. Speak with a real estate lawyer immediately.
Is my conversation with Sandeep Pawar confidential?
Yes. Sandeep Pawar treats every financial situation confidentially and can meet at any of his four offices or by phone.
Selling, buying, or just thinking about it?
A free, no-pressure conversation about where you are, where you want to be, and the smartest way to get there. Calls returned the same day, seven days a week.
Sandeep Pawar, Broker · RE/MAX Gold Realty Inc., Brokerage · 2720 North Park Drive, Suite 201, Brampton, ON L6S 0E9 · All offices