Power of Sale in Ontario: What Every Homeowner Needs to Know

If you have missed mortgage payments in Ontario and received a notice from your lender, you may be facing power of sale proceedings. This is one of the most stressful situations a homeowner can experience — but understanding the process gives you options and time to act.

What Is Power of Sale in Ontario?

Power of sale is a legal process that allows a mortgage lender to sell your home if you default on mortgage payments. Unlike foreclosure (which is rare in Ontario), power of sale does not transfer ownership to the bank. The bank sells the property on your behalf to recover what is owed. Any money left over after the bank recovers its mortgage balance and costs belongs to you.

The Power of Sale Timeline

1. Missed Payments — You miss one or more mortgage payments.
2. Notice of Sale — Your lender sends a Notice of Sale. You have a 35-day redemption period to pay arrears.
3. Statement of Claim — If unpaid, the lender files a Statement of Claim with the courts.
4. Listing and Sale — The lender lists your home, often below market value to sell quickly.
5. Proceeds Distribution — After mortgage and fees are paid, any remaining funds go to you.

Your Options When Facing Power of Sale

• Pay the arrears during the redemption period to stop the process.
• Refinance with a private lender to pay off arrears and buy time.
• Sell the property yourself before the bank completes the sale — you keep control and your equity.
• Sell to a cash buyer — close in 7 days, potentially stopping proceedings entirely.