Major Differences in buying Foreclosures in the US Vs Power of Sale in Ontario
Court House Auctions, Homes sold for thousands less than property value, we have all heard these stories.
Let me stress I am not an expert in US or for that matter Canadian Real Estate Law. The intent of this article is to answer the question:
“Why can’t I buy a home under power of sale for thousands under the retail value of the property?”
In the US it appears that the lending institutions own the property and can sell it for whatever they want as long as it makes good business sense to the lender.
This is one area where the US laws are vastly different than those we operate under in Ontario. Under our foreclosure laws a home must be sold at market value. The lending institution must demonstrate that every effort was made to obtain a market value sale.
Why you ask?
The Power of Sales indicates that the owner has been unable to make the payments as required under the terms of the Mortgage. The owner my still have equity in the property the lending institution must insure that every effort is made to return to the owner as much of the equity as possible. Under the Power of Sale, the Lending Institution takes possession of the property but not the ownership, in fact for a significant period during the foreclosure and sales process the registered owner can still retain ownership by bringing the mortgage payments up to date.
Later in this series of articles there will be more detailed Mortgage Information provided by an expert in the field, A Mortgage Broker.
what a lengthy and in depth article but full of useful information