Process of Stop Power of Sale in Brampton

If you are a homeowner is Brampton, but have found it difficult lately to keep up with your mortgage payments, you may be facing something called Power of Sale. What this essentially means is that your mortgage is in arrears and in order to recoup the money owed to them, your lender has initiated a legal process by which they can take possession of your home, evict you, and sell your home.

If you are in this situation, it can be scary and stressful however there are things that you can do in order to stop a Power of Sale. In this article, we will review what it means to be facing Power of Sale and what you can do in order to keep your home.

What is Power of Sale?

A Power of Sale is a legal process that a lender can enact when a borrower has failed to meet their obligations in making their mortgage payments. The purpose of the process is for the lender to recover their money.

After a series of legal actions, the lender is able to take possession of the property and sell it. They money from the sale goes first to the lender and any other creditors. The remaining funds (if there are any) go to the borrower.

How does power of sale work in Brampton?

In order for a Power of Sale to be valid in Brampton, there are a series of steps that need to be followed. The first step is that the lender must notify the borrower that they are in default. Once this is done, the borrower has 15 days to bring their mortgage back into to good standing before the lender can take the next step.

If the borrower fails to pay, then the lender may issue a Notice of Sale. This legal document should be sent by registered mail. Once the borrower has received this notice, there is a 35-40 day redemption period that they have to make things right with the lender.

Once the redemption period is over – and the borrower has still not paid what they owe – the lender may go to the courts for a Statement of Claim. When this is issued, the lender may begin the process of taking possession of the property in order to sell it.

In a Power of Sale, the lender never actually gets the title of the property (unlike in a foreclosure) but rather the only get the authority to sell the property. This means they must sell it for fair market value. (If they sell it at a discount in order to make a quick sale, they could be sued by the borrower).

Once the home is sold, the money from the sale goes to the following parties in this order:

• The lender
• Other creditors
• The borrower (if there is any money left after the first two have been paid).

How long is the Power of Sale process in Brampton?

The process that must be followed for a Power of Sale is very strict and there are very specific timelines that must be adhered to. The process is as follows:

• Once the lender notifies the borrower that they are in default, they must wait at least 15 before taking the next step.
• Once the 15 days has passed – and the borrower has still not brought the mortgage back into good standing – a Notice of Sale may be issued.
• Upon receiving the Notice of Sale, the borrower has another 35-40 days to pay the lender what is owed. This is called the redemption period.
• At the end of the redemption period, the lender may apply to take possession of the property and sell it.
• The time it takes to sell the property is primarily dictated by the real estate market at that time. (The borrower may stop the Power of Sale right up until the closing date.)

How to stop Power of Sale in Brampton?

Now that you know how a Power of Sale works in Brampton, the next thing you will want to know is how to stop it. Fortunately, there are a number of ways that you can do this so that you may continue to live in your home.

Ways in which you can stop a Power of Sale include:

• Bring your mortgage back into good standing – if you have the means to do so, this is the quickest and simplest solution. This may mean that you will have to dig into your savings or maybe borrow from a family member or friend.
• Refinance for your mortgage – By refinancing your mortgage, you will be getting a new mortgage that will allow you to pay off the problem mortgage. Keep in mind however that if you pay off your current mortgage early, there will be a financial penalty that you will have to pay.
• Get a second mortgage – you may also be able to stop a Power of Sale by borrowing from your home equity through a second mortgage. A second mortgage is a loan that is secured by your home equity. Once you have the loan, you would pay it off monthly or bi-weekly, just like your first mortgage. Unlike a mortgage refinance, there is no financial penalty with a second mortgage however the interest rate will likely be higher.
• Get a Stop Power of Sale loan – if you would rather not borrow from your home equity, another option is to get a Stop Power of Sale loan. This is a special unsecured loan. The amount that you can qualify for is based on how much home equity you have, but the loan itself is not tied to your home equity.
• Sell your home – finally, if you cannot get the funding you need to pay back your lender, it may make sense to sell your home before the lender does. You may get a better price for it than the lender will and come out financially further ahead in the end.

What is the best solution to stop a Power of Sale in Brampton?

While there are many different solutions for stopping a Power of Sale in Brampton, there is no one best solution. There is only the best solution for you.

Different homeowners have different circumstances so the best solution will change from case to case.

For example, if you have the funds on hand then simply bringing your mortgage back into good standing is often the best solution.

Refinancing and second mortgages are also popular solutions, but which one is best often depends on how close you are to your mortgage renewal date as this can affect which of the options is more affordable.

And then there may be reasons for preferring an unsecured loan such as a Stop Power of Sale loan.

To know which solution is best for you, you should sit down with a professional mortgage broker who can help. Your broker can assess your situation and recommend the solution that will make the most sense for you.

How do I get the best interest rate on a loan to stop a Power of Sale in Brampton?

Whatever method you choose to stop a Power of Sale, it is important that you get the best deal possible – and for any time of loan, this means getting the best interest rate.

To find the best interest rate on your mortgage refinance, second mortgage or Stop Power of Sale loan, you should work with a mortgage broker.

Because mortgage brokers have connections to an extensive network of lenders, they can shop rates on your behalf to help you find the best deal possible.

How can I stop a Power of Sale in Brampton if I have bad credit?

You may be wondering if it is even possible to get a loan to stop your Power of Sale – particularly if you have bad credit. The good news is that it is possible.

Your mortgage broker has access to many specialty lenders. By working with your mortgage broker, you can be connected with a lender who specializes in helping those with bad credit.

Just because you have bad credit, it doesn’t mean that you have to lose your home.

Advantages of working with a mortgage broker to stop a Power of Sale in Brampton

Your best chance of stopping a Power of Sale in Brampton is to work with a professional mortgage broker. Advantages of working with a mortgage broker include the following:

• They are familiar with the Power of Sale process and can help you through it.
• They can analyze your situation to come up with a recommendation for the best strategy.
• They can shop their wide network of lenders to help you find the best rates on a loan to stop your Power of Sale – even if you have bad credit.

Contact us today!

If you are facing a Power of Sale, we can help you stop it. Contact us today to speak with one of our professional mortgage brokers.