Falling behind on mortgage payments is stressful, but you have options. There are default mortgage solutions available in Ontario that provide mortgage relief for homeowners with clear pathways to protect their property and avoid foreclosure. At Maximum Property Solutions, we understand that whether you’re facing temporary financial hardship or long-term challenges, taking timely action and understanding the legal processes can help you keep your home and rebuild your financial stability.

What Triggers Mortgage Default?

Mortgage default in Ontario happens when you fail to meet the terms of your mortgage agreement. Lenders can start default proceedings for several reasons:

• Missing mortgage payments (even a late mortgage payment)
• Letting your property insurance expire
• Failing to pay unpaid property taxes
• Falling behind on condo fees or maintenance fees
• Using the property for illegal purposes

Less than 2% of mortgages in Ontario go into default, but recent interest rate increases have pushed more homeowners into financial difficulty. When challenges strike, knowing your rights becomes crucial before issues escalate further.

How Lenders Recover Money: Power of Sale vs. Foreclosure

When you default on your mortgage, lenders in Ontario have two ways to recover their money through power of sale or foreclosure. Understanding the difference helps lenders and borrowers know what to expect.

Power of Sale: The Common Option

Power of sale is the most common remedy in Ontario. The lender can sell your property without court proceedings, making it faster than foreclosure. You technically still own the home until it’s sold to a new buyer. The process is governed by the Ontario Mortgages Act and enables efficient debt recovery for lenders while providing borrowers with important protections.

If your property sells for more than your mortgage debt (including legal fees and costs), you get the leftover money. However, if the sale doesn’t cover your full debt, the lender can still pursue a deficiency judgment against you for the remaining balance.

Foreclosure: The Court Process

Foreclosure is less common and involves court proceedings. The lender takes ownership of your property, and any money from selling it later goes entirely to them, not you. While this gives lenders more control, it takes longer and costs more, which is why most Ontario lenders prefer power of sale.

The Power of Sale Timeline: What to Expect

The power of sale process follows strict legal steps under provincial legislation, typically taking four to six months from start to finish. Understanding this timeline shows you exactly when you can take action to stop legal action.

Here’s how the process unfolds:

• Day 1-15: After you miss a payment, the lender must wait 15 days before taking formal action
• Notice of Sale: The lender sends you official notice by registered mail, along with everyone who has a financial interest in your property
• Day 15-50 (Redemption Period): You have 35 days (40 if you’re married) to catch up on payments and fees—this is your best window to save your home
• Statement of Claim: If you don’t pay during the redemption period, the lender files court documents
• Writ of Possession: After a default judgment, the lender gets court permission to take possession
• Eviction: The sheriff removes you from the property if you haven’t left voluntarily (special protections apply if you have a tenant)
• Property Sale: The lender sells your home through a real estate agent at fair market value

Once properties are sold, the sale proceeds are distributed to cover costs, then the mortgage debt, and finally any surplus goes back to you. This timeline gives you multiple chances to stop the process and find alternative solutions.

Your Options to Avoid Losing Your Home

The best time to act is immediately when you realize you’re in trouble—even if you’re already in default. Here are your main options:

Talk to Your Lender First

Don’t avoid your lender’s calls—that only makes things worse. Instead, call them and explain your situation. Many lenders offer hardship programs that can help you get back on track:

• Create repayment plans to catch up on missed payments
• Request forbearance to temporarily reduce or pause payments
• Extend your mortgage term to lower monthly costs
• Switch to a different payment structure through negotiating repayment terms
• Explore early renewal options if your term is ending soon

Consider Private Lenders and Refinancing

If your bank won’t work with you, private mortgage lenders offer more flexibility. Unlike banks that focus on your credit score and income, private lenders care most about your home’s value. They typically lend up to 75-85% of what your property is worth, making it easier to get approved even with credit challenges.

Yes, private mortgages cost more—interest rates usually range from 8-15%—but they can save your home by giving you breathing room. You can use a private mortgage to catch up on payments, consolidate debt, obtain additional funds to clear a lien, reinstate your original mortgage, or replace your current mortgage entirely. Once your finances stabilize, you can refinance back to a traditional lender with better rates.

Sell Your Property on Your Terms

Selling before the lender takes over gives you control. When you sell the property yourself, you can set the price, choose your agent, and time the sale properly. You’ll avoid the negative impact on credit bureaus and additional penalty fees. You’ll also keep any profit after paying off your debts. Maximum Property Solutions can help you explore options for selling your property quickly and effectively in Windsor and throughout Ontario, even in challenging circumstances.

Getting Professional Help

You don’t have to navigate this alone. Professionals across Ontario, like Maximum Property Solutions can help both lenders and homeowners resolve default situations fairly.

For Lenders: Property Management Companies

Property management companies like MPS specialize in handling complex situations for lenders and financial institutions. They ensure all legal requirements are met, notices are properly delivered, and properties are managed effectively to get fair market value. This expertise helps lenders recover outstanding debts while ensuring compliance with Ontario’s strict legal rules under the Mortgages Act.

For Homeowners: Expert Guidance and Support

Mortgage brokers are your best ally when facing default. They have access to dozens of lenders—both traditional banks and private companies, so they can find solutions your bank won’t offer. A good broker can negotiate with your current lender, arrange refinancing, or connect you with private lenders who specialize in difficult situations.

Maximum Property Solutions works with Windsor and Ontario homeowners facing mortgage challenges to provide comprehensive support and guidance. Whether you need help navigating the power of sale process, exploring your options, or preparing your property for sale, we’re here to help. While we provide valuable guidance, complex matters may require legal counsel, as this information does not constitute legal advice.

Know Your Legal Rights

Lenders must follow strict rules during the power of sale process. If they don’t, you can challenge their actions. Getting legal and financial advice early is crucial—a lawyer can review whether your lender followed proper procedures, explore dispute resolution options, and protect your interests. Challenging lender actions may involve civil litigation if serious violations occurred.

Your key legal options include:

• Receiving proper legal notice at every step
• Having the full redemption period to catch up on payments
• Challenging the process if rules weren’t followed correctly
• Getting surplus money if your home sells for more than the total amount you owe

If your lender cuts corners on notice requirements, misses deadlines, or sells your property below market value, you may have grounds to stop or delay the process.

Take Action Today with Maximum Property Solutions

Solutions for mortgage default in Ontario exist at every stage of the process. From the moment you anticipate trouble to the final days before your home is sold, you have options to protect yourself and find alternatives. Don’t let unresolved mortgage issues destroy your financial future.

The worst thing you can do is ignore the problem. When you avoid your lender’s calls or hide from legal notices, you’re just giving away your options. Instead, take these steps immediately:

Contact your lender and ask about hardship programs. Call a mortgage broker to explore refinancing or private lending options. Consult with a lawyer to understand your rights and review the lender’s actions. Consider selling your property on your terms before losing control.

Whether you need guidance navigating the power of sale process, help preparing your property for sale, or support understanding your options, Maximum Property Solutions is ready to assist. We work with homeowners and lenders throughout Windsor and Ontario to ensure fair processes within the legal framework while helping protect your interests and explore all available solutions.

Don’t wait until it’s too late. Contact Maximum Property Solutions in Windsor, Ontario today. By understanding your rights, knowing the timeline, and acting decisively, you can navigate mortgage default challenges and protect your financial future. Call us to start the conversation about default mortgage solution options.