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Lenders are able to begin the foreclosure process after the first loan payment defaults. This process can get expensive and time-consuming, as it involves a lengthy court case and legal fees. Judicial Saleįrequently seen in British Columbia, Quebec, Alberta, Saskatchewan, and Nova Scotia, a Judicial Sale is when the lender has to petition to the judicial court for permission to sell the property. There are two different ways a lender can sell a repossessed home and you’ll want to understand them both, should you encounter these terms while you’re house hunting.
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In order to recoup this loss, they force the borrower to sell the home. Unlike a short sale, it’s a process the lender initiates when a borrower fails to make a certain number of mortgage payments in a row, typically four payments or 120 days of default in total. That being said, this doesn’t mean they don’t happen at all.Ī foreclosure, by definition, is a legal process in which a lender attempts to recover the balance of a loan from a borrower who has stopped making payments by forcing the sale of the asset used as the collateral for the loan. Lenders often don’t want to go through the foreclosure process as it’s quite expensive and time consuming. What Is A Foreclosure?įoreclosures aren’t incredibly common in Canada. If you’re on the hunt for a new home but feel like you just can’t afford anything, take this opportunity to learn more about the benefits of purchasing a foreclosed home, what the foreclosure process looks like and what you can expect when you decide to place an offer on a foreclosed home.
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As a result of the increasingly high property costs and competitive bidding atmosphere, some buyers may be seeking foreclosed homes in the hope of finding a great deal. It’s no secret that the housing market in Canada is red hot.