Foreclosure stopped before the court process was complete

The scenario

Consider a homeowner in the Hamilton area with an owner-occupied detached home. After a lengthy illness reduces their income, they miss several mortgage payments. The lender begins legal foreclosure proceedings and retains counsel.

By the time a homeowner in this position reaches out, the legal process is often already underway, which makes the timeline tight and the need for a workable solution urgent.

Why the banks say no

Traditional lenders decline applications like this because the foreclosure process has already started, there are recent missed mortgage payments, and the borrower's credit has declined significantly.

What we do

In a situation like this, we would arrange a private second mortgage on a 12-month term. It covers the legal costs, mortgage arrears, and penalties, and provides additional funds to help stabilize the homeowner's finances while they get back on track.

The outcome

The foreclosure action is discontinued before the court process advances. The homeowner stays in their property and resumes making regular payments.

The exit strategy

The plan is to refinance into a B-lender mortgage after twelve months of on-time payments, once the file is stable and the payment history has been rebuilt.

Facing something similar? Learn more about stopping a foreclosure, or mortgage arrears assistance.

This is an illustrative example based on the types of foreclosure situations we regularly help with. It does not depict a specific client, and the names, location, and figures are representative rather than actual. Individual results vary and are subject to lender approval.