Quote:
Originally Posted by albertGQ
Man. If I was in that situation, I'd be tempted to just walk away.
|
I don't think that's an option.
I would almost think that you would have to declare bankruptcy after walking away, and if the CMHC decides to come looking for you, you have to prove that you declared bankruptcy and the CMHC was notified of your bankruptcy.
Good article that explains at the bottom
http://www.financialpost.com/persona...374/story.html
Quote:
n Canada it’s pretty tough to do. For starters, if you have an insured mortgage, backed by the government, the bank will get paid off for their loan. But the insurance company, whether it’s Canada Mortgage and Housing Corp. or a private insurer, will go after you for any deficiency created by proceeds from the property being less than the mortgage.It’s the case in most of the country for uninsured mortgages too, says John Turner, director of mortgages for Bank of Montreal. Rules are slightly different in Alberta and designed to protect consumers but Mr. Turner says banks can elect to go after other assets in some circumstances.
There’s also a scenario where you might have bought a condominium as an investment before it was built and put down say 20% payment. If you think you walk away should prices drop by 50% once the building is up, forget it. You’ll be sued.
“As a lawyer we can’t advise someone to break a contract. The law is not you don’t have to obey it, the law is the consequences of not obeying [the contract],” says Calgary lawyer Jeff Kahane. “You haven’t broken the law, you’ve broken your promise. Is it any different than saying why would I want to pay for a chocolate bar at 7-11 when I can put it into my pocket and steal it if I can get away with it.”
|
Quote:
How the power of sales or Foreclosure works in Canada?
So what should you do if you find yourself on the brink of foreclosure? Well, for starters, it’s helpful to recognize that, unlike in the U.S., you don’t have the option of mailing in your keys and walking away. In Canada, the mortgage debt is the homeowner’s – not the lender’s – and the lender can do whatever it takes to get that money from you, including garnish your wages. As a full-time Canadian real estate investor, you should be aware of the downsides to a loan or mortgage.
|