Foreclosures in British Columbia are a legal process where a lender (most often a bank) takes control of a property due to the homeowner failing to meet their mortgage obligations. The process is designed to allow the lender to recover the unpaid balance of a defaulted loan. Here’s a detailed look at how the foreclosure process typically unfolds in BC:
1. Missed Payments
The foreclosure process begins when a homeowner fails to make their mortgage payments as agreed. Typically, lenders will allow a grace period, but if the account remains delinquent, they will initiate foreclosure proceedings.
2. Demand Letter
The lender will send a demand letter to the homeowner, which outlines the amount owed and gives the homeowner a limited time to pay. This is also known as a notice to cure the default.
3. Petition to Court
If the homeowner does not settle the outstanding amount, the lender will file a petition with the Supreme Court of British Columbia, seeking permission to sell the property. This petition includes all the details of the property, the mortgage, the defaults, and the amount owed.
4. Court Order
Once the petition is filed, the court will set a hearing date. The homeowner will be served with a notice of this hearing and will have an opportunity to appear in court to present their side.
5. Order Nisi
If the court decides in favor of the lender, it will grant an Order Nisi which sets the redemption period, typically six months. During this time, the homeowner can pay off the total amount owed or sell the property to cover the debt.
6. Order for Conduct of Sale
If the homeowner does not redeem the property during the redemption period, the lender may apply for an Order for Conduct of Sale. This order allows the lender or a court-appointed officer to sell the property.
7. Sale of Property
The property is then listed for sale, typically by a real estate agent. The sale must be conducted fairly and for market value. Proceeds from the sale are used to pay the mortgage and other charges in priority order.
8. Order Absolute
Once the property is sold, the court may issue an Order Absolute, transferring full ownership to the buyer and removing all rights of the former homeowner.
Sources for More Information:
- Supreme Court of British Columbia: Provides access to forms and a detailed description of the foreclosure process.
- BC Government - Housing & Tenancy: Offers information about housing, mortgages, and legal actions related to housing in BC.
- Law Society of British Columbia: Find legal advice and lawyers who can assist with the foreclosure process.