Stop Power of Sale in Ontario
We lend on your home's equity to pay the arrears and stop the sale, often within days.
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Financial challenges causing mortgage arrears in Ontario can lead to imminent Power of Sale for homeowners. Numerous lending options exist for Ontario homeowners seeking second mortgages or borrowers seeking their first mortgage. There are ways to stop the Power of Sale on an Ontario property. Lenders aim to avoid Power of Sale; Ontario homeowners should strive to prevent it and protect their homes.
Understanding Power of Sale
In Ontario, both traditional and private lenders have processes to recover mortgage funds if payments are missed. Lenders utilize two methods to handle mortgage default. Foreclosure1 and Power of Sale2. In Ontario, Power of Sale is the most utilized method lenders will use when a property goes into default.
What is Power of Sale? In this default process, the lender takes the right to sell the property. The lender possesses the authority to sell a home or property. In Power of Sale, the homeowner retains ownership, yet the lender gains the legal right to sell the house. Under section 22 of the Mortgages Act, the homeowner keeps the right to stop the process by paying the arrears and the lender’s reasonable costs before a sale takes place, bringing the mortgage back into good standing3.
The homeowner defaults once a property owner falls behind in monthly mortgage payments or fails to meet other mortgage terms. The consequences of default can lead to legal actions such as foreclosure or Power of Sale proceedings. Mortgage default remains rare: as of April 2026, only 0.28% of Canadian mortgages were in arrears, according to the Canadian Bankers Association4.
Power of Sale – What Does It Involve?
A lender can now legally possess and sell the property, following distinct steps in Power of Sale. A lender must:
- Allow for 15 days – Once a borrower has fallen into arrears, the Ontario Mortgages Act5 requires that the lender allows 15 days for the borrower to try to rectify the situation before the lender—traditional or private— can exercise the Power of Sale.
- Send a Notice of Sale to Borrower – After 15 days without rectification, the lender can notify the homeowner. This is an official Notice of Sale, signalling borrower default and providing a redemption period for rectification. Under section 32 of the Mortgages Act, the lender cannot sell the property until at least 35 days after the notice has been given6.
- Lender Will Issue a Statement of Claim – If the borrower does not pay what is due by the redemption period, the lender has the legal right to issue a Statement of Claim to address the debt owed and take possession of the property. The claim is filed with the Ontario Superior Court of Justice, and mortgage actions are governed by Rule 64 of the Rules of Civil Procedure7.
- Lender Can Apply to Take Possession of the Property – After the Statement of Claim has been issued. If the borrower fails to pay the mortgage or fees, the lender may seek court permission for possession and eviction, enforced through a writ of possession under Rule 60.10 of the Rules of Civil Procedure8. The current owners must leave by the specified date or face forcible removal by authorities.
- Take Steps to Sell the Property – In the final step of the Power of Sale, the lender can possess and sell the property in its current condition. The previous owner is responsible for substantial fees, reducing profits significantly in Power of Sale. Under section 27 of the Mortgages Act, the sale proceeds are applied first to the costs of the sale and the mortgage debt, and any surplus must be paid back to the homeowner9.
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Trustindex verifies that the original source of the review is Google. Ways to Stop Power of Sale
Ontario homeowners must understand that the Power of Sale process is time-consuming and demands patience. The Mortgages Act10 requires a 15-day waiting period before a Notice of Sale can be issued, plus a redemption period of at least 35 days after it, and court steps add more time. In our experience, Power of Sale typically takes about 6 months from notice to lender property possession. This time is very valuable. The Financial Consumer Agency of Canada11 also outlines relief measures, such as mortgage payment deferrals, that may help homeowners in short-term difficulty. This window of time allows for several options to try to stop the Power of Sale, including:
- Attempt to sell the house before the lender takes final possession – There are buyers in Ontario who can buy your property in its current state. Evaluating your property’s current appraisal and local comparables confirms it’s available for purchase at market value with a discount. Preventing exorbitant costs of Power of Sale, which in our client files can reach up to $30,000 in legal, realtor, and administrative fees, and avoiding renovation expenses as the property sells as-is.
- Obtain a second mortgage on your property – By taking out an additional mortgage on your current property, a property owner will have access to funds to pay off any arrears and cover the monthly mortgage payments comfortably. Most second mortgages are offered by alternative lenders and not banks. To avoid Power of Sale, tap into home equity . It gains control, prevents complications, and improves credit with timely payments.
- Take out a new primary mortgage– There is also the possibility of taking out a new mortgage to replace the current mortgage that may be in default. Well-established private lenders throughout Ontario will assess Loan-To-Value (LTV) on your property by evaluating a recent assessment. Private lenders offer up to 75% LTV of the property’s value, needing more than 25% equity. First or second mortgages can halt an impending Power of Sale. The loan-to-value (LTV) ratio is the most important factor for a private lender. The LTV ratio is the percentage of the property’s value owed in mortgages. Calculate this ratio by taking all existing mortgages plus all proposed mortgages and dividing by the appraisal value.
Mortgage Broker Store Can Help Stop a Power of Sale on Your Home
Mortgage Broker Store is well experienced and has specialized knowledge in the Power of Sale process as well as methods to stop a Power of Sale. Our network of private lenders can help clear arrears and legal fees and preserve your home’s value through financing options.
Information regarding power of sale, foreclosure, and related legal processes is provided for educational purposes only and should not be relied upon as legal advice. Laws and procedures may change. Readers should consult a qualified lawyer regarding their specific situation.
Power of Sale Ontario FAQ
Answers to common questions about this Mortgage Broker Store page.
Can Mortgage Broker Store help after a power of sale notice in Ontario?
Yes. The team can review the notice, mortgage balance, property value, arrears, and timeline to see whether refinancing, private lending, a sale, or another strategy is practical.
How much time do I have to stop a power of sale?
The timeline depends on the notice date, lender actions, province, and legal status of the file. It is important to get advice quickly because options usually narrow as the lender moves closer to sale.
Can a private mortgage stop a power of sale?
A private mortgage may help if there is enough equity to pay the arrears, costs, and any required debts. The lender will still need a clear exit plan, current property value, and legal review.
What information should I prepare for a power of sale review?
Prepare the lender notice, recent mortgage statement, property tax balance, estimate of property value, income details if available, and any court or lawyer correspondence.
References
- Rules of Civil Procedure, R.R.O. 1990, Reg. 194, Rule 64 — foreclosure and other mortgage actions in the Superior Court of Justice ↩︎
- Mortgages Act, R.S.O. 1990, c. M.40, s. 24 — statutory power of sale where a mortgage is in default ↩︎
- Mortgages Act, R.S.O. 1990, c. M.40, s. 22 — right to pay arrears and costs before a sale and be relieved from the consequences of default ↩︎
- Canadian Bankers Association, Mortgages in Arrears — national arrears rate of 0.28% as of April 2026 ↩︎
- Mortgages Act, R.S.O. 1990, c. M.40, s. 32 — notice of sale may only be given after default has continued for at least 15 days ↩︎
- Mortgages Act, R.S.O. 1990, c. M.40, s. 32 — no sale until at least 35 days after the notice of sale has been given ↩︎
- Rules of Civil Procedure, R.R.O. 1990, Reg. 194, Rule 14 and Rule 64 — commencing a Statement of Claim and mortgage actions; see also the Ontario Superior Court of Justice ↩︎
- Rules of Civil Procedure, R.R.O. 1990, Reg. 194, Rule 60.10 — writ of possession ↩︎
- Mortgages Act, R.S.O. 1990, c. M.40, s. 27 — application of sale proceeds; any surplus is paid to the mortgagor ↩︎
- Mortgages Act, R.S.O. 1990, c. M.40, s. 32 — minimum 15-day default period and 35-day notice period before sale ↩︎
- Financial Consumer Agency of Canada, Mortgage payment deferrals — relief measures for homeowners in financial difficulty ↩︎