“I’m behind on my payments… Am I going to have to give my Montreal house back to the bank?”
Nobody wants to lose their home. Unfortunately, financial circumstances can sometimes work against you. All the commitments you’ve made seem unmanageable.
If this situation persists, you may have to give your home back to the bank in Montreal, Quebec. You may not have a place to live for a while. What’s more, there could be long-term consequences, including a dramatic impact on your credit rating and your ability to buy a home in the future.
Nobody wants that. It’s not an ideal ending. Fortunately, there’s a strategy you can employ today to protect yourself and get back on track financially.
Here’s a brief overview of the financial recovery process.
Repossession can be different depending on your location and the type of mortgage you have.
Usually, if you skip a few mortgage payments,
the company that lends to you will first send you notices, then warnings. After a while, if you don’t repay the missed payments, the company may put your home up for auction.
Once the house has been sold at public auction, you’ll be entitled to live in it for a while, but you’ll need to find a new home fairly quickly.
Fortunately, there are other options!
If you wait until your home is foreclosed, it could have a devastating effect on your credit rating. One way to protect yourself is to agree with your creditor to make what is known as a “voluntary surrender”.
This means that you will hand over the keys to your house to your creditor. This avoids the costs associated with the data entry process, which can be quite high. For your part, you’ll avoid having to add a financial recovery to your credit file.
Another way to avoid foreclosure is to sell your home before it goes to auction. If your loan is repaid in full, you won’t face any additional penalties and your credit rating will remain intact. (If your loan is not repaid in full, you’ll have to pay the remainder out of your own pocket).
Here’s an example: Let’s say you owe $100,000 on your home and you sell it for $90,000. You’ll have to give the money to your creditor and pay the difference, which is $10,000. Your loan will then be repaid. (If you work with a real estate lawyer, you may be able to negotiate a voluntary surrender agreement in which your creditor agrees not to ask you to pay the difference.
At Vendre Maison Vite, we have a team of professional real estate investors. Call us today at 514-320-1000 to find out how much we can offer you for your home, even if it’s in need of renovation.
I don’t want my house foreclosed by the bank in Montreal!
Why do people decide to sell their homes rather than 
let the financial recovery take place? (After all, they won’t be able to live in their house anyway).
That’s because, although it’s difficult to abandon your home, the impact of voluntary abandonment on your financial situation will be much less dramatic than if you simply waited until the property was foreclosed. In fact, a financial repossession could cost you as much as 100 or 150 points on your credit rating. The challenge of selling your home in the short term is minimal compared to the problems you’d have to live with if you let the bank foreclose.
