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Ontario Real Estate Licensing Exam Practice · Question

A lender initiates a Power of Sale on a residential property in Barrie due to unpaid mortgage payments. What is a key step the lender must undertake before selling the property under Power of Sale in Ontario?

Under the Mortgages Act (Ontario), a lender exercising Power of Sale must first serve the borrower with a Notice of Sale, allowing the borrower a redemption per

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Question: A lender initiates a Power of Sale on a residential property in Barrie due to unpaid mortgage payments. What is a key step the lender must undertake before selling the property under Power of Sale in Ontario?

Answer options: ✅ Serve the homeowner with a Notice of Sale Under Mortgage, giving them a specified period to remedy the default.

  • Obtain a court order for foreclosure before any sale can occur.
  • Offer the property back to the original homeowner at a discounted rate.
  • Renovate the property extensively to maximize sale proceeds before listing.

Correct answer: Serve the homeowner with a Notice of Sale Under Mortgage, giving them a specified period to remedy the default.

Explanation: Under the Mortgages Act (Ontario), a lender exercising Power of Sale must first serve the borrower with a Notice of Sale, allowing the borrower a redemption period (typically 35 days for residential properties) to cure the default.

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