Private Mortgage Loans

Sometimes a borrower is not able to get approval for a mortgage loan through a bank, credit union, finance or other regular lender. When these conventional options are not available, some will resort to private lenders.

I Regularly Act for Private Lenders

If you are a private lender, remember that many lawyers will not know the regulatory requirements that apply to private lenders or have court experience dealing with defaults. I can provide my private lender clients information about regulatory requirements and help if there is a default.

If you are making an RRSP loan secured by mortgage through various trust companies such as Olympia Trust Company or Canadian Western Trust Company, I am familiar with them and can help you.

Loan Documents & Renewals of Private Mortgage Loans

I can help a private lender with all of the required loan documents and registrations. I highly recommend that the borrower be required to see their own lawyer or notary to get their documents signed. It can be a conflict of interest to act for both in certain cases, but more importantly, if I have acted for both on the lending side, I cannot choose sides if the loan is later in default. I normally can't act for either against the other.

I often see private mortgage loans where the renewals have not been documented properly. I can help my private lender clients with renewals.

Foreclosures on Behalf of Private Lenders

Private loans carry a higher rate of return but also a higher risk of default. They can often result in a loss. If you need to enforce your mortgage, I can help you with that process. I have about 35 years of experience doing this. I regularly conduct mortgage foreclosure or judicial sale actions on private mortgages. My approach is to give practical advice on how to handle the problem and personalize the information given to the court in the various stages of the action rather than using generic boiler plate documents. Your chances of moving the action along in court can often be better when the judge understands your situation better.

Contested Private Mortgage Loan Actions

Sometimes a borrower will contest your court action enforcing your mortgage. They may feel they have a real defence, but often they are simply wanting to stretch the action out as long as possible when they are not able to pay. I have a great deal of experience in dealing with contested actions.

Clients Borrowing or Facing Foreclosure

Just as I act for private lenders, I act for borrowers getting private mortgage loans or facing problems with private mortgage loans. I can represent you through the process and help you make the best of your situation rather than have you spend large amounts for legal fees on arguments bound to fail that will often only lead to frustration and disappointment.

If a Mortgage is Already in Default

If you are a private lender and the borrower is already in default on your loan, remember that the court process is quite lengthy in Saskatchewan. The procedure is quite different from many provinces such as Ontario. Give reasonable time for the borrower to bring payments current, but be realistic and proactive when your instincts tell you they probably will not be paying you. Inaction can increase losses. Remember that if loan payments are in arrears, the borrower is often not paying property taxes and they will have priority over the mortgage. This can also be the case if there is a first mortgage on title ahead of you. Real estate values, especially in smaller towns, may not be as good as you thought when the loan was made. The property fire insurance policy may have lapsed, exposing you to the potential of serious loss if it suffers damage. If the borrowers have moved out, they may have stopped paying utilities. An unheated house or other building can easily freeze in the winter, resulting in great loss that regular insurance policies, even if in place, probably will not cover. Check with your borrower to ensure that the property is occupied and utilities are all connected. Get a copy of the insurance renewal to ensure that coverage is still in place.

Experience

The public often assumes that every lawyer is well versed in all areas of the law. Of course that is not possible. I don't practice criminal law, family law, personal injury law or many other areas or the law because it is not possible to be highly competent at everything. However, I do regularly deal with private mortgage loans and mortgage foreclosure issues. I can help if you have a problem in that area.