Stop a Power of Sale in Ontario
If you have missed mortgage payments or received a Notice of Sale, you still have options. The window is limited, but acting early gives you the best chance to protect your home and your equity.
Just received a letter from your lender? A power of sale is the process an Ontario lender uses to sell your home after a mortgage default. This page explains how it works, how much time you typically have, and the practical ways homeowners stop it before the sale goes through.
What is a power of sale in Ontario?
A power of sale lets your mortgage lender sell your property to recover what you owe after you fall behind on payments. In Ontario it is far more common than foreclosure.
Unlike foreclosure, a power of sale does not transfer ownership of your home to the lender. The lender sells the property, uses the proceeds to clear the mortgage balance, legal costs, and arrears, and any surplus that remains is returned to you. The process is set out in Ontario's Mortgages Act, and lenders must follow specific notice steps before a sale can proceed.
Important to note: Because you keep title until the property is actually sold, you generally retain the right to stop the process by bringing the mortgage back into good standing or paying it out, right up until a firm sale closes.
Power of sale is not used everywhere in Canada. It is the standard mortgage enforcement route in Ontario, and it also applies in Prince Edward Island, New Brunswick, and Newfoundland and Labrador. Most other provinces rely on foreclosure instead. If you are outside Ontario, our mortgage foreclosure page covers how the process differs across the country.
Power of sale vs foreclosure
The two terms are often confused, but they work differently. Here is how they compare for an Ontario homeowner.
| Power of Sale | Foreclosure | |
|---|---|---|
| Who holds title | You keep ownership until the home is sold | Lender applies to court to take ownership |
| Court involvement | Usually none required | Judicial process through the courts |
| Surplus equity | Any surplus after costs is returned to you | Lender may keep the property and its equity |
| Speed | Faster and lower cost for the lender | Slower and more expensive |
| How common in Ontario | The standard route lenders use | Rare in Ontario |
For a fuller breakdown of the foreclosure side, including how it works across other provinces, see our mortgage foreclosure page.
The Ontario power of sale timeline
The process is time sensitive, and each stage narrows your options. Timelines often vary depending on your mortgage terms, but the sequence usually looks like this.
Mortgage default
You fall behind on payments, or breach another mortgage term such as property taxes or insurance. Under Ontario's Mortgages Act, a lender generally must wait at least 15 days after the default before issuing a formal notice.
Notice of Sale Under Mortgage
The lender serves a formal Notice of Sale, typically by registered mail. This is when the legal clock officially starts, and it triggers a redemption period.
Redemption period
This is your window to act. It is often in the range of 35 to 45 days depending on the mortgage and circumstances, though it can vary. During this time you can typically bring the mortgage into good standing or pay it out to stop the sale.
Statement of Claim and possession
If the redemption period passes without resolution, the lender can move toward listing the property and, eventually, taking possession. Your options shrink quickly at this stage, which is why early action matters.
Timelines are general and vary by lender, mortgage terms and law firm. Check your own mortgage and legal notice documents, and consider getting legal advice about your specific notice.
Will you owe money after a power of sale?
This is one of the biggest worries homeowners have, and the answer depends on what your home sells for compared to what you owe.
If the sale covers what you owe
The lender uses the proceeds to pay off the mortgage balance, arrears, and legal and selling costs. Any surplus left over after those costs is returned to you. This is the key advantage of a power of sale over a foreclosure, where the lender may keep the property and its equity.
If the sale falls short
If the home sells for less than the total owing, the shortfall is called a deficiency, and the lender may be able to pursue you for that difference. Lender-run sales of "as-is" properties can sell below market value, which is part of why acting early matters.
The takeaway: Whether you keep the home or decide to sell, taking control early usually protects more of your equity than waiting for the lender to sell on your behalf. Refinancing or selling on your own terms puts you in charge of the price and the timeline.
How to stop a power of sale
Most homeowners have more than one path forward. The right one depends on your equity, your income, and how much time is left on the clock.
Catch up on the arrears
If you can pay the missed payments plus any legal costs the lender has added, you can often bring the mortgage back into good standing.
Refinance with a new lender
A new mortgage can pay out the lender in default and reset your situation, even when your current bank will not work with you.
Add a second mortgage
If you have equity, a second mortgage can clear arrears, taxes, and legal fees without disturbing your existing first mortgage.
Sell on your own terms
Selling before the lender does often protects more of your equity, because you control the price, the agent, and the timeline.
Negotiate or reinstate
Some lenders will agree to a repayment arrangement, especially if the hardship is temporary. Communicating early keeps this option open.
Not sure where to start? Our team can walk you through what may fit your situation. See how a second mortgage or a refinance to consolidate debt could apply.
Start by seeing how much equity you have
Most solutions that stop a power of sale, from refinancing to a second mortgage, depend on the equity in your home. Our free home equity calculator gives you a quick starting point so you can see what may be possible before you speak with anyone.
Try the Home Equity CalculatorWhy banks decline, and where private lending fits
Once you are behind on payments or facing a power of sale, most traditional banks step back. Their approval process leans heavily on credit score and income history, which is exactly what tends to be under strain during a mortgage default.
Key takeaway: Private and alternative lenders look at the situation differently. They focus on the equity in your property rather than your credit score, which is why they can often help when a bank will not.
As part of a licensed Ontario mortgage brokerage, LendToday works with a wide network of lenders to arrange financing built around your equity and your timeline. That means one point of contact to review your options and move quickly when it counts.
- Equity-based solutions when banks focus only on credit
- Access to first mortgages, second mortgages, and refinances
- A single review of your situation, not a dozen separate calls
Do you qualify?
Homeowners in these situations are often good candidates for a solution that stops a power of sale:
- You own a property in Ontario with equity built up in it
- You have missed payments or received a Notice of Sale
- Your bank has declined to help or renew your mortgage
- You want to keep your home, or sell it on your own terms
- You need a clear plan before the redemption period runs out
Ontario law firms that handle power of sale matters
A power of sale is a legal process, and you may wish to speak with your own lawyer about your rights and your specific notice. The firms below are examples of Ontario firms that commonly act for the lenders and institutions enforcing a power of sale, so you may recognize one of these names on your paperwork. Many other firms handle this work as well, and this is only a partial list. It is provided for information only and is not legal advice, a referral, or an endorsement. As a team of licensed mortgage brokers in Ontario, LendToday is familiar with how these matters proceed and can help you understand your options as a homeowner.
Talk through your options today
Every day you wait narrows what is possible. A quick, confidential review can help you understand where you stand and what steps make sense next.
Get Your Free Options ReviewPower of sale FAQ
Can I actually stop a power of sale once it has started?
In most cases yes, up until the property is sold. You can typically bring the mortgage back into good standing by paying the arrears and costs, pay off the mortgage entirely, or refinance to a new lender. The earlier you act, the more options remain available.
How much time do I have after a Notice of Sale?
The redemption period is often in the range of 35 to 45 days, though it varies with your mortgage terms and circumstances. Check your mortgage documents and the notice itself, and treat the timeline as tight rather than relying on the maximum.
What is the difference between power of sale and foreclosure?
In a power of sale, the lender sells your property and returns any surplus to you after costs. In a foreclosure, the lender applies to the court to take ownership of the property. Power of sale is the far more common route in Ontario.
Can I sell my home during a power of sale?
Generally yes, until the lender completes a sale. Selling on your own terms often protects more of your equity, because you control the listing price, the agent, and the closing timeline.
Will a power of sale affect my credit?
A mortgage default and power of sale can have a significant impact on your credit and make future borrowing harder for a period of time. Resolving it before a sale, through refinancing or catching up, is usually the better outcome.
Can refinancing really stop the process?
Often, yes. A new mortgage can pay out the lender in default, clear the arrears and legal costs, and stop the sale. This can work through a private or alternative lender even when a traditional bank has declined.
This page is general information about the power of sale process in Ontario and is not legal advice. For advice on your specific situation, consult a licensed lawyer.