An Alberta property owner has defaulted on their mortgage. The lender initiates foreclosure proceedings. What is the standard legal process in Alberta for a lender to recover the outstanding debt when a borrower defaults on a mortgage?

Question: An Alberta property owner has defaulted on their mortgage. The lender initiates foreclosure proceedings. What is the standard legal process in Alberta for a lender to recover the outstanding debt when a borrower defaults on a mortgage?

Answer options:

• The lender automatically takes possession of the property and sells it privately. ✅ The lender must obtain a court order for judicial sale to sell the property.
• The property reverts to the provincial government under the Land Titles Act.
• The borrower can declare bankruptcy, and the mortgage is automatically discharged.

Correct answer: The lender must obtain a court order for judicial sale to sell the property.

Explanation: In Alberta, which operates under the Torrens system of land registration, mortgage foreclosure typically involves a judicial sale. The lender must apply to the Court of King's Bench for an order to sell the property and recover the debt from the proceeds.