The Foreclosure Rate in Alberta is up 25% With no end in sight
Tags: Foreclosure
There was an article published by Global News in May 2017 that reported that over the last 2 years, Alberta’s foreclosure rate had increased by 25%. http://globalnews.ca/news/3455634/foreclosures-in-alberta-up-about-25-annually-for-past-2-years/
Although, the job market in Alberta seems to be more stable, there are a number of people still searching for employment, mainly in the oil and gas sector. I personally know several former co-workers that have been without paid employment for more than two years and they are in a terrible financial mess. Savings can only last so long and eventually it becomes harder to keep up with bills and expenses. It's hard to come to terms with reality, but unless something is done, you may be at risk of losing your home to foreclosure. If this is your situation, what can you do to stop the bank from taking away your home?
The very last thing you need at this point in time in your life is for the bank to start harassing you, demanding immediate mortgage payment and threatening you with foreclosure. As if you did not have enough to deal with already! You are late with your car payments and repossession could happen any day now, not to mention the never-ending calls from collection agencies demanding money that you don’t have. What can you do?
The first step is to realize that you are not alone. In fact, there are at least 5,746 families in Alberta going through the same financial pain you are (as reported by the Global News). Foreclosure is a major challenge for thousands of families across the country. I realize that this piece of information is not useful, but it is important. It provides perspective in demonstrating that other people are experiencing similar financial struggles.
The second step is to stay calm and try to avoid the panic that may be settling in - especially in front of your family. You need to maintain a level head in order to survive this ordeal. I know this sounds difficult especially with the constant calls and letters from collection agencies, all of which do not improve your anxiety levels. Take charge of the situation! Do not allow your spouse and/or children to see your fear or to see you in panic mode; instead, reassure them by telling them hat you will all make it through somehow and that everything is going to be okay.
Next, you need to come to a realization that you can’t afford to sit and do nothing. The bank can and will take away your home if you do not take some sort of action. Apart from harassing you to catch up on your late payments, foreclosure is the only legal tool that the bank has at its disposal to recover its losses.
The worst thing that you can possibly do is ignore the problem. Sometimes we mistakenly believe that ’to do nothing’ is to postpone a decision, when in actuality ‘to do nothing’ is to make a choice by default. You literally cannot afford to make the same mistake that thousands of people have already made. The consequence of doing nothing affects not only your finances but also your physical, emotional, and spiritual well-being. The truth is that your situation will not improve and it will not go away on its own. The bank can and will repossess your home if you do not take appropriate action.
If you already know that your bank account is empty and there are insufficient funds to cover your mortgage payment for the month, don’t wait until the bank collection agent starts calling you. Approach your bank mortgage broker and explain your financial situation. In most cases the bank will allow you to defer your mortgage payment for up to 4 months. All you need to do is show is your employment separation papers (ROE) and in most situations the bank will work with you as long as you talk with them. This will give you time to think through your options. One option may be to put your house on the market and sell it. Unfortunately, the bank will not be able to extend you a line of credit on your property even if you have equity in your home due to lack of employment.
Another obstacle in the foreclosure process is the lack of reliable information available. The majority of books and general postings on the internet are on “How to take advantage of great foreclosure deals.” There is very little information available that helps struggling homeowners avoid going into foreclosure.
There are a few things that you can do to improve your situation:
Although, the job market in Alberta seems to be more stable, there are a number of people still searching for employment, mainly in the oil and gas sector. I personally know several former co-workers that have been without paid employment for more than two years and they are in a terrible financial mess. Savings can only last so long and eventually it becomes harder to keep up with bills and expenses. It's hard to come to terms with reality, but unless something is done, you may be at risk of losing your home to foreclosure. If this is your situation, what can you do to stop the bank from taking away your home?
The very last thing you need at this point in time in your life is for the bank to start harassing you, demanding immediate mortgage payment and threatening you with foreclosure. As if you did not have enough to deal with already! You are late with your car payments and repossession could happen any day now, not to mention the never-ending calls from collection agencies demanding money that you don’t have. What can you do?
The first step is to realize that you are not alone. In fact, there are at least 5,746 families in Alberta going through the same financial pain you are (as reported by the Global News). Foreclosure is a major challenge for thousands of families across the country. I realize that this piece of information is not useful, but it is important. It provides perspective in demonstrating that other people are experiencing similar financial struggles.
The second step is to stay calm and try to avoid the panic that may be settling in - especially in front of your family. You need to maintain a level head in order to survive this ordeal. I know this sounds difficult especially with the constant calls and letters from collection agencies, all of which do not improve your anxiety levels. Take charge of the situation! Do not allow your spouse and/or children to see your fear or to see you in panic mode; instead, reassure them by telling them hat you will all make it through somehow and that everything is going to be okay.
Next, you need to come to a realization that you can’t afford to sit and do nothing. The bank can and will take away your home if you do not take some sort of action. Apart from harassing you to catch up on your late payments, foreclosure is the only legal tool that the bank has at its disposal to recover its losses.
The worst thing that you can possibly do is ignore the problem. Sometimes we mistakenly believe that ’to do nothing’ is to postpone a decision, when in actuality ‘to do nothing’ is to make a choice by default. You literally cannot afford to make the same mistake that thousands of people have already made. The consequence of doing nothing affects not only your finances but also your physical, emotional, and spiritual well-being. The truth is that your situation will not improve and it will not go away on its own. The bank can and will repossess your home if you do not take appropriate action.
If you already know that your bank account is empty and there are insufficient funds to cover your mortgage payment for the month, don’t wait until the bank collection agent starts calling you. Approach your bank mortgage broker and explain your financial situation. In most cases the bank will allow you to defer your mortgage payment for up to 4 months. All you need to do is show is your employment separation papers (ROE) and in most situations the bank will work with you as long as you talk with them. This will give you time to think through your options. One option may be to put your house on the market and sell it. Unfortunately, the bank will not be able to extend you a line of credit on your property even if you have equity in your home due to lack of employment.
Another obstacle in the foreclosure process is the lack of reliable information available. The majority of books and general postings on the internet are on “How to take advantage of great foreclosure deals.” There is very little information available that helps struggling homeowners avoid going into foreclosure.
There are a few things that you can do to improve your situation:
- First, take an inventory and figure out exactly where you are in the foreclosure process. What I’ve found in dealing with people facing financial difficulties is that, in general, they stop opening their mail because they do not want to face the fact that people are demanding money from them. Do yourself a favour - open your mail. There may be one very important letter titled “petition to foreclose” read it, follow the instructions and respond to it as soon as you can. Once you have received the “Petition to Foreclose” letter from the court, respond within the allotted time (in most cases it is 21 days). This letter is the formal request from the lending institution to the court to initiate the foreclosure process. The foreclosure process is time sensitive and varies in every province in Canada. If you fail to respond to this letter, you will forfeit your rights as a homeowner and you will be unable to defend yourself in a court of law. The foreclosure process will continue without you. Therefore, you will lose your right to defend your home.
?
- Seek legal advice. I can’t stress this enough, seek legal advise. You may feel that you can’t afford it, but the reality is that you cannot afford the luxury of not getting legal advice. It is extremely important that you do so as soon as you possibly can. Since the real estate laws vary in every province, you need to know how to protect yourself within the court system, you must gain the knowledge of your rights and obligations specified under the law as a homeowner.
- Share your financial situation with family and friends. No one likes to talk about finances or the lack thereof, especially when their finances are not good. We pretend that our finances are in good standing and we hide the truth from our loved ones and pretend that everything is fine until it is too late. When a foreclosure order has been granted to the lending institution, a bailiff will come to your house and remove you and your family, along with all of your possessions from your home. Understand that there is nothing to gain by hiding the truth. I am sure that there are people in your life who care about you, and if you open up to them about the truth of your financial situation they will be able and willing to help you. Believe me, there is less shame in telling friends and family members that you are struggling financially, than to have to tell them later that you lost your home to foreclosure. Reach out and ask for help.
Above all, please remember that you will make it through somehow and rest assured that everything is going to be okay.
I hope you enjoyed reading my article about the foreclosure rates in Alberta. Please remember to visit my website www.jbenitez.ca and like my Facebook page.
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Joaquin Benitez is a licensed real estate agent and author of the book, The Foreclosure Phenomenon: How to Defend Your Home from an Impending Foreclosure, available at Amazon.com and chapters.indigo.ca
