Foreclosure Laws in Alberta
If an individual is interested in foreclosures in Alberta, it is important for them to understand specific information about mortgages, as they relate to foreclosure sales. More importantly, the person will need to know the distinction in the types of mortgages that exists in Alberta. The first of which is known as the Land Title Act mortgage, and the 2nd is known as an Equitable Mortgage. The distinctions between the two will determine how
foreclosure procedures will be handled.
Land Titles Act Mortgages and Foreclosure Procedures
When a farmer applies for a Land Titles Act Mortgage, the farmer uses a specific piece of farm land for its security. Once the farmer receives the money from the loan, the creditor’s will have an interest in the land, which is represented by the registration against the certificate of the title. Therefore, if the farmer defaults on the loan, the creditor can obtain a remedy from the court via a
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judicial sale of the land. Guidelines for these mortgages are administered according to the Land Titles Act.
Equitable Mortgages and Foreclosure Procedures
Equitable mortgage foreclosures usually vary, especially since the certificate of title for the land adheres to a different process. In specific, a duplicate title of the land is given to the creditor when the loan is being made. If the borrower defaults on paying the loan, the creditor can then send a Demand letter that states that full payment of the loan is due. If the lender cannot pay the amount of the demand letter, the creditor can seek a court order (Order Nisi) to sale the land.
The owner of the land will also have a remedy if the land is sold, and that is one year of redemption to keep it from being completely lost. Once the land is sold through a foreclosure, the creditor cannot continue to pursue collection efforts from the borrower (loan amount less than sale of foreclosure amount).