# The forced sale of property for unsecured credit card debt



## attheendofmyrainbow (Sep 26, 2016)

I was notified today that a debt collector is going to forced the sale of my home to collected on a unsecured credit card debt. They have a judgement and a lien on my name for anything that has my name on, but what I am wondering can they force the sale of my home for that debt. I know that this debt has to be paid if I sell or transfer ownership but I was not aware that they could force a sale.


----------



## Spudd (Oct 11, 2011)

I just did a quick google and it looks like maybe they can:
https://www.moneyproblems.ca/debt-solutions-blog/judgement-on-my-house-can-they-force-me-to-sell/
https://bankruptcy-canada.com/bankruptcy-blog/can-i-be-forced-to-go-bankrupt-in-canada/


----------



## humble_pie (Jun 7, 2009)

what a terrible emergency. 

i'm sure others will comment with better suggestions, but here is all i can think of at the moment:


this is a real emergency

you would best be helped by a real lawyer, not an internet chat board

if you can't afford a lawyer, you will have to make do with whatever legal help you can scrounge up. Call your nearest university student law clinic. Every city has one or more of these. Sometimes you can find them through neighbourhood YMCAs, YWCAs, YMHAs. Ask social services in your town where are the free student-run legal clinics. Be persistent until you find one.

also keep in mind that these are students who could make mistakes.

the reason i'm not suggesting legal aid is because i'm assuming it would take weeks to get through the application red tape & actually talk to a person who might be able to help. Whereas with the student clinics you ought to be able to reach someone within a couple of days.

i know almost nothing about this area of life but it sticks in my memory that creditors are not supposed to take someone's house. Perhaps someone else could comment more accurately on this point though.

if you can squeak through the emergency & get the creditors at bay, you will have to reform yourself from top to bottom. From toenails to haircut. From soup to nuts. What kind of crazy life is that, where you spent your credit card to the point where creditors are going to seize your home? chile, you izz badass.


you might benefit from a good budgeting mentor. Here again you could search the YMCAs & the social services for a budget counselling service. If you still have a bank account, your neighbourhood bank branch might be able to point you in a few directions.

very best wishes

.


----------



## attheendofmyrainbow (Sep 26, 2016)

humble_pie said:


> what a terrible emergency.
> 
> i'm sure others will comment with better suggestions, but here is all i can think of at the moment:
> 
> ...


Thanks Humble
This is a credit card debt from 2011 and I have had some medical issues and lost my job, that has made it impossible to repay. I do not have or will not ever have another credit card.


----------



## humble_pie (Jun 7, 2009)

the debt must have compiled atrociously, so sorry to hear 

could you still try to find a lawyer or a law student PDQ. Are there any chances of saving your home. What are these chances. What would you have to do.

if there is merit to your story & if you could get yourself before some kind of tribunal or judge, i do believe there could be sympathy in such a case.

what i don't know - only a helper with legal training would know - is what few house-saving steps may still be left. What avenues of appeal might still be open.

.


----------



## attheendofmyrainbow (Sep 26, 2016)

The debt is for 17 thousand I will take your advice and see what options are out there of me.


----------



## Market Lost (Jul 27, 2016)

I think HP's response is excellent, but my question is why didn't you go to a credit counselor? They would have been able to either set up a plan to avoid this, or would help you through bankruptcy if that is required. It sort of sounds like you've been trying to close your eyes, and hope it all went away.


----------



## humble_pie (Jun 7, 2009)

Market Lost said:


> my question is why didn't you go to a credit counselor? They would have been able to either set up a plan to avoid this, or would help you through bankruptcy if that is required. It sort of sounds like you've been trying to close your eyes, and hope it all went away.




Lost i thought of this but didn't mention for 2 reasons. Numero uno, the emergency is right now, if he wishes to save his house he will have to take some action very soon. What i felt was best was for him to find the best legal support he could, within a very short period of time. I was mindful that he might not be able to afford a bar association lawyer.

i thought there was nothing to be gained by dwelling on the history at this moment. Whatever he did to ostrich his awareness of the spiralling-out-of-control credit card debt is in the past. Rightly or wrongly i felt that all of the available energy should be focused on the present & on the near future.

(to rainbow, if you're reading here) here is a far-fetched idea. If you have some time & energy stiill available after meeting the lawyer & carrying through with whatever actions might be possible, i'm wondering about the bank that owns the credit card company. My idea is stiil too vague & unformed, i should not be posting it, but on the other hand it's possible that someone else might be able to develop the idea further.

somewhere in that bank, if it's a canadian chartered bank, is a division that concerns itself with community well-being. Could they help you. The idea is not to beg for dollar relief but might they intervene to call off the creditors while you work to develop a sensible plan about how you're going to pay off the debt.

.


----------



## twa2w (Mar 5, 2016)

To the OP 
How were you notified of this
Is your home paid for, or do you have a mortgage and if so, how much equity do you have. Is your debt and home only in your name.
It is possible for a company to force sale of your house for a debt but it is an involved legal process so you have some time to deal with this.
If you have a mortgage and little equity, I doubt they would go through the process because they essentially have to pay off your mortgage when they seize the house and recover it and all costs when they sell. There is a lot of risk in this for them if the house doesnt sell quickly or for as much.
I suspect it is posturing on their part to get you to pay but if your home is paid for or has a ton of equity, all bets are off.

If you are in Ontario, find the phone number for the upper Canada law society lawyer referral service. Call them, tell them your issue.. They will refer you to a lawyer close to you. You will get 1/2 to 1 hour ( dont recall the exact details) free or very cheap( less than 100.00) consultation. Ask the details when talking to the lawyer referral service.
Take all your documentation with you including house details, mortgage details and copies of judgements and any thing you have been served with. The lawyer will explain things to you and what will likely happen and what options you have.
If you are not in Ontario, most provinces law societies have a similar referral service and usually you get 1/2 HR to 1 HR for free or for some nominal fee depending on province.


----------



## carverman (Nov 8, 2010)

twa2w said:


> It is possible for a company to force sale of your house for a debt but it is an involved legal process so you have some time to deal with this.
> If you have a mortgage and little equity, I doubt they would go through the process because they e*ssentially have to pay off your mortgage when they seize the house and recover it and all costs when they sell*. There is a lot of risk in this for them if the house doesnt sell quickly or for as much.



If they have secured a lien, they can also force a power of sale in Ontario. It depends on whether its' the credit card bank or company or the credit card debt has been sold to a collections agency, which can do some very nasty things if they want to. 

From CTV news...


> POWER OF SALE VS FORECLOSURE
> Each process is a forced sale of real property, with Power of Sale being common in Ontario, Newfoundland, New Brunswick and PEI. *The POS process is much faster, so its main advantage is the procedure does not get tied up in court.*
> 
> The homeowner retains title to the property, and also receives any surplus after the debts and costs are paid from proceeds. (However in some cases, dependent upon negotiations, *if the proceeds from the sale are insufficient to cover the debt including expenses the creditor MAY be able to sue for the remaining outstanding balance.*
> ...



However, depending on how much equity you have in your home, you could go to your mortgage lender and refinance your mortgage to pay off the credit card debt.



> *What else can I do while facing power of sale or Foreclosure in Canada?*
> If other debt payments – such as credit card debt, car loans, or student loans – are preventing you from making your mortgage payments, you may be able to refinance your mortgage. In order to refinance, though, your total debts can’t be greater than 90% of your home’s value.
> 
> While you might have to pay a fee to break your mortgage, the benefit of refinancing is that it allows you to roll all your debts into your home at a lower interest rate. For instance, right now the rate on a typical five-year fixed mortgage is 4.5%. In most cases, your minimum monthly payments are drastically reduced, giving you increased cash flow.


www.canadianwealthbuilders.com/foreclosures/facing_foreclosure.html

I see the "alpine credit" ads a lot on TV these days. They say that if "you own your home..you're approved". 
I don't know if this would work for the OP, but it's worth looking into.


----------



## Nerd Investor (Nov 3, 2015)

I would go see someone who works in insolvency/financial recovery (may large accounting firms with have an Insolvency department). Yes they deal with people filing for bankruptcy but the good ones will explore other options such as consumer proposals as well. They'll probably also be able to answer some of the questions you have about your situation more accurately. Good luck!


----------



## twa2w (Mar 5, 2016)

Carverman, foreclosure and power of sale are different than a writ of seizure and sale. That is why the OP should go see a lawyer.


----------



## Mukhang pera (Feb 26, 2016)

attheendofmyrainbow said:


> I was notified today that a debt collector is going to forced the sale of my home to collected on a unsecured credit card debt. They have a judgement and a lien on my name for anything that has my name on, but what I am wondering can they force the sale of my home for that debt. I know that this debt has to be paid if I sell or transfer ownership but I was not aware that they could force a sale.


A few questions, if I may:

1. How were you notified and by whom?

2. You say "they" have a judgment. Who are "they"? Is it a bank? You mention a credit card debt of $17k. Were you sued for that (or some other) amount? Were your served (personally or by registered mail) with court documents that you ignored? If so, perhaps "they" did obtain a default judgment against you. But ya' know what? I am suspicious that there is no judgment. If there were, I would expect you would be hearing from a lawyer. "Debt collectors" have no power to issue process or to obtain and enforce judgments. 

In the ordinary course of events, a creditor might turn your delinquent account over to a debt collection agency. They would hound you for awhile (did that occur?) and, if you did not pay up in response to their entreaties, the creditor would most likely either give up or, if it felt the debt was more than it cared to write off, if would then hand the matter over to a lawyer. The lawyer would send you a "demand letter" saying you gotta' pay up within so many days or an action will be commenced without further notice. Then would follow issuance of a writ (or whatever it's called in your jurisdiction). Once you get it, you have time to file a defence and, if you don't, the lawyer can file for default judgment. The judgment can be registered against any real estate in your name, even if you own with someone else.

With a registered judgment, a lawyer (not a debt collector, because debt collectors are prohibited from doing anything that amounts to the "practise of law") could then apply under the Court Order Enforcement Act (or Execution Act or whatever prevails in your province) for an order for sale. I have never in some decades of experience in BC seen that done, but the legal machinery is in place to permit it. Keep in mind that courts are slow to dispossess anyone from their home. Even more so if it's a family home, more than one owners, etc. It almost certainly won't happen on a summary chambers application. Worst case scenario in all probability would be an order for monthly payments, with a sword held over your head that the place could be sold in default of payment.

HP and some others here have given you some good advice. Numero uno, act with some alacrity. Do not bury your head in the sand. Get some legal help, even if from a law school clinic or similar organization offering free legal help. Consider getting a title search of your real estate. See if a judgment has been registered. In BC, I believe the practice is for the Registrar of Land Titles to give you notice if a judgment is filed against your land. But find out for sure.

As for "a lien on my name for anything that has my name on", that sounds rather imaginative. In most places, some effort is required to place a lien on anything. One must comply with the Land Title Act, Court Order Enforcement Act, Personal Property Security Act, etc., etc. A "debt collector" cannot by simple fiat bind all that you own.

Back to the beginning. My nose tells me there is no judgment here and the limitation period where you are may now have run. You might well have received a call from a "debt collector" having a go at scaring you into paying up. That's their job. But you need to find out the real legal status of the matter, and sooner rather than later.


----------

