Treat it as urgent. A Notice of Sale starts the 35-day redemption period under Part III of the Mortgages Act, after which the lender can list and sell. Within the first few days, confirm the arrears in writing, gather your mortgage and any default correspondence, and get legal advice on whether the notice is valid. Options include paying arrears to reinstate, refinancing with a new lender, selling privately at fair market value, or, where the notice is defective, applying to restrain the sale. The earlier you act, the more options you have.

Under section 22 of the Mortgages Act, the lender must wait at least 35 days from service of the Notice of Sale before listing the property. Many mortgages contractually require a longer notice period — check the mortgage instrument. Until the redemption period expires, the borrower has an absolute right to reinstate the mortgage by paying the arrears, costs, and any properly accelerated amounts.

Yes, in several ways. Reinstate the mortgage during the redemption period by paying the arrears and costs — typically funded by a refinance or private bridge. Sell privately at fair market value before the lender does, capturing any equity above the mortgage. Where the Notice of Sale is defective, apply to restrain the sale. Where 35 days is not enough time, the court can extend the redemption period in appropriate cases. The right path depends on your equity, finances, and the conduct of the lender.

Power of sale is a contractual remedy under the Mortgages Act — the lender sells the property, applies the proceeds to the mortgage and any subordinate encumbrances, and pays any surplus to the borrower. Foreclosure is a court order vesting title in the lender, extinguishing the borrower’s equity of redemption — the lender keeps the property and any surplus value, but cannot sue for a deficiency. Foreclosure is rare in Ontario because power of sale is faster and preserves the right to a deficiency judgment.

The lender owes the borrower a duty to act in good faith and obtain the best price reasonably available. Where the lender sold too quickly, with inadequate marketing, at an undervalue, or to a related party, the borrower can sue for the difference between the sale price and fair market value — and raise the same conduct as a defence to any deficiency claim. We assess the listing duration, asking price, marketing program, and offers received, and retain appraisal evidence to quantify the loss.

A deficiency judgment is a judgment against the borrower (and any guarantor or covenantor) for the shortfall after the property is sold and the proceeds applied. Deficiency claims are commonly defended by attacking the validity of the Notice of Sale, the lender’s duty to obtain best price (which often eliminates the deficiency entirely), and the inflated default interest, legal fees, and administrative charges packed into the claim. Personal guarantors of corporate mortgages regularly face deficiency claims long after the sale has closed.

A typical residential power of sale closes in 90 to 120 days from default: the 35-day redemption period, plus 30 to 60 days of marketing, plus a normal closing period after an accepted offer. Complications — a contested sale, a defective Notice of Sale, multiple subordinate encumbrancers, title issues, or occupants who will not vacate — can extend the process. On the borrower side, the 35-day window is what matters: every option to keep the home compresses into that period.

As a subordinate mortgagee, your charge ranks behind the first mortgage — only proceeds remaining after the first mortgage is paid out are available to you. Your options: pay out the first mortgage to stop the sale and preserve the equity for your own enforcement, monitor the senior sale to ensure the duty to obtain best price is met (a sale at undervalue prejudices you directly), or exercise your own power of sale in parallel subject to the first charge. Where the senior lender’s conduct has prejudiced your security, you may have a claim against it.

Yes. Mortgage arrears, default, and the resulting power of sale are reported to the credit bureaus by most institutional and many private lenders, and the impact on a credit score is significant and long-lasting — typically six to seven years. The credit consequences are one reason that resolving the default during the redemption period — through reinstatement, refinance, or private sale — is almost always preferable to allowing the lender to sell.

Yes, and it is often the best outcome where there is meaningful equity. Selling on the open market at a properly marketed asking price almost always yields a higher price than a lender-controlled power of sale — lenders are motivated to close quickly, not to maximize the surplus paid to the borrower. List the property, accept an offer that closes before the redemption period expires, and use the proceeds to pay out the mortgage at closing. Where timing is tight, we coordinate with the lender’s counsel to hold the power of sale in abeyance pending the private sale.