3. Standard Charge Terms in a mortgage and how they affect sale of properties under Power of Sale |
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| POS Overview | Bank Options | Legal Aspects| Standard Charge Terms | POS Considerations | Quit Claim | Foreclosure | Power of Sale | Issues | Sale Price | POS Process | POS appropriate? | Clauses in Offer | How will Lindsay Protect you? | Conclusion |
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In Ontario there is the Land Registration Reform Act which stipulates all the rules of how properties are owned. Under this act is the "Set of Standard Charge Terms" which are registered at the registry office of any municipality in Ontario. The standard charge terms can vary slightly and banks and institutions register their own set of standard charge terms at the registry offices too. Their set of standard charge terms are almost all exactly the same, except for the fact that these standard charge terms are registered under each banks own name and are completely in favour of that particular bank. The main reason for registering these standard charge terms is because each bank will refer to their standard charge terms in every mortgage that they receive from each owner and since they are already registered at each registry office, it makes things much simpler and easier for the bank to have them included in each and every mortgage (charge) that is registered at the registry office. (as an aside, your mortgage will contain a reference to set of standard charge terms registered as instrument number xxxxxxxxx at the land registry office of your municipality. Again, this is a convenience issue plus a legal requirement) There are about a dozen or so set of standard charge terms that each bank uses and registers. The important and very brief headings for each term are outlined below.
So there you have it. These are the most common set of standard charge terms that all banks use and register along with your mortgage. Royal Bank may have the order a little different compared to Scotia Bank, and BMO may have one or two more terms, but all sets of standard charge terms contain about the same terms as shown able. So, why am I telling you all this? The reason is that if you can understand the basics of the standard charge terms then you now understand the playing field. You now know the standard rights that you must navigate around when it comes to your mortgage. Everyone pays close attention to your mortgage rate, term, payments, amortization, but few pay attention to the fine print. The fine print in your mortgage really is there to explain what can happen to the owner in the event that the owner defaults on payment and outlines the rights and remedies open to the bank. Now that you know the set of standard charge terms you can see how your relationship with your bank begins with the mortgage and sets out the terms of your entire agreement and transaction with your bank. They are giving you the money so you have to give them the mortgage. It's a nice arrangement when it works. When it doesn't work, (when the owner defaults), then the standard charge terms become extremely important and lay the foundation for all remedies and rights of the bank and owner. Again, every lender/bank/institution/mortgagee has their own set of standard charge terms that are registered at the registry office and referred to in every new mortgage that. The great thing about Power of Sale is that POS lets the bank "Sell and Sue" which means not only can the bank sell the property to get their debt repaid, but they can also sue for any deficit. The 'fairness' about POS in Canada is that the bank cannot profit from POS, any profits go to the owner. Not likely, but if there are profits that's where they go. In the United States the banks are privately owned and operated and are profit oriented, thus they prefer foreclosure for profit. You may wish to read an entire example of a set of Standard Charge Terms from CIBC The next section of this series of articles deals with the Advantages and Disadvantages of the Power of Sale option |
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| POS Overview | Bank Options | Legal Aspects| Standard Charge Terms | POS Considerations | Quit Claim | Foreclosure | Power of Sale | Issues | Sale Price | POS Process | POS appropriate? | Clauses in Offer | How will Lindsay Protect you? | Conclusion |
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If you have any questions or require further information about Power of Sale properties or anything to do with real estate, please send me an email I can assist you with all of the complexities when you purchase or sell your next home. Please don't hesitate to email me Thank you, You may read more about Power of Sale, Bank Sales and Foreclosure Properties or go back to list of Real Estate Helpful Articles Use the form below and you will receive your FREE list of all the Power Of Sale | Estate Sale | Fixer Upper properties from ALL the Real Estate Companies across the GTA matching your specific criteria - You may Email Me for More Information & Save Thousands of Dollars. Receive ALL New Listings That Match Your Home Buying Criteria e-mailed to you free of Charge. What is a Foreclosure Property? What is a Power of Sale Property? Why is this service useful to you? If you receive these notices first, before anyone else, you will be the first to see the property before most other buyers and then you can potentially purchase the property before others have even seen it! We are then able to help you negotiate the lowest possible price when you purchase your property through us!
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| POS Overview | Bank Options | Legal Aspects| Standard Charge Terms | POS Considerations | Quit Claim | Foreclosure | Power of Sale | Issues | Sale Price | POS Process | POS appropriate? | Clauses in Offer | How will Lindsay Protect you? | Conclusion
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