This article provides general information about power of sale in Ontario as of November 2026 and is not legal advice. It was researched from the primary texts, read on 12 November 2026: the Mortgages Act (consolidation from 1 January 2022), the Rules of Civil Procedure (from 1 September 2026), the Condominium Act, 1998 (from 31 December 2025) and the Legislation Act, 2006 (from 11 December 2025), CMHC's release on Ontario mortgage arrears of 27 October 2026, and the Court of Appeal for Ontario decision cited below. A licensed Ontario lawyer can advise on your own situation.
Power of sale Ontario law runs on a clock with minimums the statute sets. For most mortgages, a lender can send a Notice of Sale 15 days after a missed payment at the earliest, and sell 35 days after that, without a court action for the sale itself. Almost everything you can still do, from catching up to selling the house yourself, has to happen inside those windows, and the options narrow at each step.
This guide walks through that clock in order: what you can do at each point, how power of sale differs from foreclosure, where the sale money goes, and what buyers of power of sale homes take on. If you're weighing whether you need a lawyer at all, our guide to what real estate lawyers do in Canada covers the wider picture.
Power of sale Ontario, in five lines
Power of sale lets a mortgage lender sell your home after a default without a court action for the sale, on minimum periods the Mortgages Act fixes. Here is the whole process in compressed form.
- The minimum clock: under section 32 of the Mortgages Act, notice can't go out until the default has lasted at least 15 days, and no sale can happen for at least 35 days after the notice.
- No clause, longer clock: if the mortgage has no power of sale clause (and doesn't exclude the Act's), notice can go out after 15 days of default, but no sale can happen until both 45 days' notice and three months from the default have passed (sections 24, 26 and 30).
- Your strongest right: where the default has made the whole balance due, section 22 lets you pay what is in default plus the lender's necessary expenses, at any time before sale, and be relieved of the default.
- The lender's duty: it has to take reasonable precautions to get the best price reasonably obtainable, and any money left after the debts are paid belongs to you.
- The trend: CMHC reports that Ontario's mortgage arrears rate reached 0.32% in Q2 2026 (payments 90 days or more overdue) and expects it to keep rising through mid-2027.
The power of sale timeline: the dates the law sets
The Mortgages Act fixes the earliest dates, and the lender can't go faster without a judge's leave. Days are counted under the Legislation Act, 2006, which excludes the first day and includes the last.
| Stage | Mortgage with a power of sale clause | Mortgage with no clause | Where it comes from |
|---|---|---|---|
| Notice can be given | 15 days after the default, or longer if the mortgage says so | 15 days after the default | ss. 26 (2), 32, 37 |
| Sale can be made | 35 days after the notice | 45 days after the notice, and not before three months of default | ss. 24, 26 (1), 32 |
| Notice by registered mail | Counts from the day it was mailed | Same | s. 34 |
| Skipping notice | Only with a judge's leave | Same | s. 39 |
Under section 89 of the Legislation Act, 2006, "at least 35 days" between two events means the second event can fall on day 35 at the earliest. These are floors. A lender can take longer, and the mortgage can set longer periods (s. 37), but none can lawfully move faster unless a judge allows it.
The power of sale Ontario clock below does the counting. Enter the date of the first missed payment to see your own floor dates, and what each window still leaves open.
Power of sale clock · Ontario
The earliest dates the Mortgages Act allows, and what you can do in each window
Earliest day a sale can be made
Mon, December 21, 2026
50 days after the missed payment, if notice goes out on the first allowed day (Nov 16)
- Before any noticeNov 1 to Nov 16
- Pay the missed amount and bring the mortgage back into good standing
- Ask the lender in writing for a statement of what is in default; it has 15 days to answer
- Talk to the lender about a payment plan, or to another lender about refinancing
Mortgages Act ss. 22, 32
- The notice periodNov 16 to Dec 21
- Where the default made the whole balance due, paying the arrears plus the lender's necessary expenses relieves you of the default
- If the notice demands the full balance, the lender is bound to accept payment made as the notice requires
- The lender generally can't start other proceedings until the notice period ends
- Refinance, or sell the home yourself and pay the mortgage from the proceeds
Mortgages Act ss. 22, 42, 43
- Sale possiblefrom Dec 21
- Where the whole balance was called, you can still pay the amount in default and the lender's expenses until a sale
- If you're still living there, the lender generally needs a court order, and the court's leave for a writ of possession, to remove you
- If the home is rented, the lender can only get possession from the tenant under the Residential Tenancies Act, 2006
- The lender has to take reasonable precautions to get the best price reasonably obtainable
Mortgages Act ss. 22, 48 · Rules of Civil Procedure r. 60.10 · RCML Corp., 2023 ONCA 352
- After the saleonce a sale is made
- The right to reinstate ends. Any surplus after the sale costs, the mortgage and later creditors goes to the owner
- If the price doesn't cover the debt, the lender can sue for the shortfall
- A notice defect generally can't undo the buyer's title; the claim is for damages against the lender
Mortgages Act ss. 22, 27 (statutory power), 36
The first two weeks: the missed payment, before any notice
For at least 15 days after a missed payment, the lender can't send a Notice of Sale. It is often the cheapest window to fix the problem, because the amount owing is at its smallest and no Notice of Sale costs have been added.
Consider Daniel and Ama, a made-up couple in Brampton with a mortgage payment of $3,100 a month. Daniel's hours at an auto parts plant are cut, and the November 1 payment doesn't go through. Under section 32, the earliest their lender can give notice is November 16.
What tends to help at this stage:
- Catching up the missed payment. Paying the arrears before notice can keep enforcement costs from being added, though the mortgage may already charge a fee for the missed payment.
- Asking for a statement in writing. Section 22 (2) lets the owner ask in writing for a statement of what is in default and the lender's expenses. Under s. 22 (3), the lender has 15 days to answer, and if it fails to answer without reasonable excuse, or the answer is incomplete or incorrect, its right to enforce is suspended until it complies.
- Talking to the lender early. A payment plan or a deferral is a matter of agreement with the lender, not a right, so it can help to ask before notice goes out.
- Checking other debts. CMHC notes that rising arrears on car loans, credit cards and lines of credit can appear before mortgage arrears do. A home with tax debt can also carry a Crown lien, which our guide to CRA collections explains.
The Notice of Sale arrives: what it is, and who gets it
A Notice of Sale is the formal warning, in a form the regulations prescribe, that the lender intends to sell. Section 31 requires it to go to everyone with an interest ranking after the lender's, not just the owner.
That list includes anyone appearing on the parcel register and the execution index as having an interest, a Crown or public authority with a statutory lien the lender has written notice of, and anyone else whose interest the lender has written notice of. Section 33 allows personal service or registered mail to the last known address. Because section 34 deems a mailed notice given on the day it was mailed, the 35 days can start before the envelope reaches you.
A notice can be defective: too early, missing a person entitled to it, or demanding sums that aren't owed. Under section 36, though, a buyer's title generally can't be challenged on those grounds once the sale is made. The person harmed has a claim against the lender instead. That is why it can help to raise a defect with a lawyer during the notice period rather than after the sale.
The 35 days: what you can still do during the notice period
During the notice period, the owner can still reinstate the mortgage, pay it out, refinance or sell. Where the notice was given under the mortgage's own power of sale clause, the lender generally can't take other enforcement steps until the period ends.
Back in Brampton, the notice to Daniel and Ama is mailed on November 18, so the earliest sale date is December 23. Their realistic options during those 35 days:
- Reinstating under section 22. Where the default has made the whole balance due, paying the amount in default (not the payments that simply haven't come due yet) plus the lender's necessary expenses relieves the owner of the default. The right lasts "at any time before sale".
- Paying out under section 43. If a notice under the mortgage's power of sale clause demands the whole balance, the lender is bound to accept payment made as the notice requires. A dispute over the lender's costs can go to an assessment officer.
- Refinancing. A new lender, sometimes a private one at a higher rate, pays out the old mortgage. The arrears and costs come out of the new loan.
- Selling the home yourself. An owner who sells and closes first keeps control of the price and the timing. Our guide to real estate lawyer fees in Ontario covers what a sale costs to close.
Section 42 adds a breathing space: once a notice under the mortgage's own power of sale clause declares an intention to sell, the lender generally can't start other proceedings on the mortgage until the notice period ends, unless a judge allows it. The main exception is a step to stop waste or damage to the property.
After the notice runs out: possession, listing and sale
Once the notice period ends, the lender can sell. If the owner is still living there, it generally needs a court order for possession first, and a writ of possession can only be issued with the court's leave. If the home is rented, the lender can only get possession from the tenant under the Residential Tenancies Act, 2006 (Mortgages Act s. 48).
Rule 60.10 of the Rules of Civil Procedure lets a court give leave for a writ of possession only where everyone in actual possession has had enough notice of the proceeding to ask the court for relief. The writ lasts one year and can be renewed. It is enforced by the sheriff.
The lender then markets the property. Its duty is one of care, not a guaranteed result: in RCML Corp. v. 2524258 Ontario Inc., 2023 ONCA 352, the Court of Appeal for Ontario found "no evidence that the respondent failed to take reasonable precautions to obtain the best and highest price for the property". The Toronto home there sold for just under $4 million after about 11 months on the market and some 50 showings, near two appraisals and comparable sales on the street. The court also noted the principle, from its earlier decision in Manufacturers Life v. Granada Investments, that an owner who says the price was too low has to show a higher price would have been obtained but for a breach.
The section 22 right lasts "at any time before sale", and the Act doesn't define the moment a sale is made. An owner hoping to pay up after the lender has signed an agreement with a buyer will want a lawyer's view quickly.
Where the sale money goes, and when you still owe
The lender keeps what it is owed plus allowable costs. Later creditors with an interest in the property are paid next in order of priority, and anything left belongs to the owner. If the price falls short, the lender can sue for the difference.
Section 27 of the Mortgages Act sets out this order for a sale under the Act's statutory power. For a sale under the mortgage's own power of sale clause, the mortgage's terms and the case law govern, and a lawyer can confirm how they apply to a given sale.
| Order | Paid from the sale price | What it usually covers |
|---|---|---|
| 1 | Sale expenses | Real estate commission, legal costs of the sale, costs of any failed attempt to sell |
| 2 | Interest and costs on the mortgage | Arrears of interest, enforcement costs |
| 3 | Principal on the mortgage | The outstanding balance |
| 4 | Subsequent encumbrancers, in order of priority | A second mortgage, a lien, an execution |
| 5 | Tenants' rent deposits not applied | Last month's rent paid under the Residential Tenancies Act, 2006 |
| 6 | The owner | Whatever is left |
Costs of exercising a power of sale can be assessed by an assessment officer at the request of anyone interested (s. 43 (4)), so an owner who thinks the costs taken from the sale are too high has a route to challenge them.
The shortfall works the other way. RCML itself was a claim for the deficiency left after a power of sale, and the lender won summary judgment for it. A personal promise to pay survives the sale. An owner in this position may first get a demand letter, then a statement of claim, which our guide on how to sue someone in Ontario walks through from the other side.
Power of sale vs foreclosure in Ontario
Power of sale is a private sale the lender runs, with any surplus going to the owner. Foreclosure is a court action that ends with the lender owning the home, with no sale and so no surplus.
| Power of sale | Foreclosure | |
|---|---|---|
| Court action | Not needed for the sale; possession from an occupant generally needs an order | An action in the Superior Court of Justice under Rule 64 |
| Who ends up with the home | A buyer, at the lender's sale | The lender, by a final order of foreclosure |
| Your equity | Any surplus after costs and creditors is yours (s. 27 for the statutory power) | Lost once the order is final |
| Key deadlines | Sale no earlier than 35 days after a notice given after 15 days of default | Owner's defence or request to redeem within 20 days of service in Ontario, or before being noted in default; 60 days to redeem after the account is taken |
| Your main tool | Paying the default before sale (s. 22) | A request to redeem, or a request for sale (r. 64.03 (6), (17)) |
| Personal claim | Lender can sue for any shortfall | Lender can also claim payment personally (r. 64.03 (5)) |
Rule 64.03 (17) matters for owners with equity. An owner who wants the home sold rather than lost, but doesn't want to defend the action, can file a request for sale within the time for a defence, or before being noted in default, and the lender can then take judgment for a sale. In a court-supervised sale, the buyer pays the money into court and it is paid out by priority, with a deficiency order available against any defendant liable for the mortgage debt (r. 64.04 (12) to (14)).
Condo owners: the common expenses lien
A condo corporation can use power of sale too. Unpaid common expense fees create a lien on the unit, and once registered, the lien can be enforced in the same manner as a mortgage.
Under section 85 of the Condominium Act, 1998, the lien covers the unpaid amount, interest, and reasonable collection costs. It expires three months after the default unless the corporation registers a certificate of lien. The corporation has to give the owner written notice at least 10 days before it registers. Section 86 generally ranks the lien ahead of other encumbrances, including earlier ones, subject to listed exceptions.
Say you own a one-bedroom unit in Ottawa and fall $2,400 behind on fees after a job loss. Interest and reasonable collection costs are added to the lien, so the amount can grow quickly, and the 10-day notice is often the moment to settle, or to ask for a payment arrangement in writing.
Buying a power of sale home in Ontario
A power of sale home is sold by a lender who has never lived in it, often on an "as is" basis. It isn't automatically a bargain, because the lender has to take reasonable care to get a proper price.
Consider Leila, a made-up first-time buyer in Hamilton who finds a power of sale listing priced near recent sales on the street. What she takes on is different from an ordinary purchase:
- Less information. The seller can't tell her what the previous owner knew about leaks, permits or renovations. An inspection carries more weight.
- Title protection. The lender's statutory declarations about the default, service and compliance are conclusive evidence of compliance and enough to give good title, subject to the Land Titles Act (s. 35). Separately, a buyer's title generally can't be challenged over notice defects; the harmed person's claim is against the lender (s. 36).
- Tenants may come with the house. The lender becomes the tenant's landlord (s. 47) and can only get possession under the Residential Tenancies Act, 2006 (s. 48). For a single family home, it can give at least 60 days' notice on behalf of a buyer who undertakes in writing to live there (s. 53), and a tenant can go to court if the buyer doesn't move in within 180 days (s. 54). Our Landlord and Tenant Board guide explains the tenant's side.
- Title insurance. It is worth asking how a policy treats a sale under power of sale. Our guide to title insurance in Ontario covers what it protects.
Land transfer tax and closing costs apply as on any purchase.
When to talk to a lawyer
A Notice of Sale is often the point to bring in a lawyer, because the next 35 days decide most of the options. A real estate lawyer can explain the paperwork; a litigation lawyer handles disputes over notices, costs and price.
It is often worth getting advice when:
- a Notice of Sale has arrived, or a statement of claim for possession or foreclosure;
- the notice seems early, demands sums you don't recognise, or missed someone with an interest;
- you have equity and want a sale, not a foreclosure;
- a refinancing or private sale is in progress and the dates are tight;
- the lender has sold and you think the price was too low, or it is claiming a shortfall;
- you are buying a power of sale home and want the agreement reviewed.
You can check any lawyer's or paralegal's licence with our guide to finding a lawyer on the Law Society directory, and our guide to what a lawyer costs in Ontario explains how they bill.
How Olanur helps
We built Olanur so that someone with a deadline can describe the problem once and hear from the right lawyers, without calling firm after firm. Matching is free, and you choose who to speak with.
For a Notice of Sale, that usually means an Ontario real estate lawyer. For a dispute over price, costs or a shortfall claim, lawyers on our platform who handle disputes and claims are a closer fit.
Frequently asked questions
The power of sale Ontario timeline has statutory floors. For a mortgage with a power of sale clause, the Mortgages Act requires at least 15 days of default before notice and at least 35 days of notice before a sale, so about 50 days at the earliest. Without a clause, notice can go out after 15 days, but no sale can happen until 45 days of notice and three months from the default have both passed. Getting possession and finding a buyer can add time.
Often, yes, until the sale is made. Where the default has made the whole balance due, section 22 of the Mortgages Act lets you pay the amount in default plus the lender's necessary expenses and be relieved of the default. Refinancing, or selling the home yourself and paying out the mortgage, also ends the process.
Power of sale is a sale the lender runs without a court action, and any money left after costs and other creditors goes to the owner. Foreclosure is a court action under Rule 64 that ends with the lender owning the home outright, so there is no surplus for the owner.
You can. If the sale price doesn't cover the mortgage, interest and costs, the lender can sue on your personal promise to pay. In RCML Corp. v. 2524258 Ontario Inc., 2023 ONCA 352, the Court of Appeal upheld a judgment for the shortfall left after a power of sale.
Not necessarily. The lender has to take reasonable precautions to get the best price reasonably obtainable, so they may be listed near market price. They are often sold "as is", with little information about the home's history, and an owner can stop the process by paying the default before the sale is made.
The tenancy continues. Under sections 47 and 48 of the Mortgages Act, the lender steps into the landlord's shoes and can only get possession under the Residential Tenancies Act, 2006. For a single family home, section 53 lets it give at least 60 days' notice for a buyer who will live there.
It can. Under section 85 of the Condominium Act, 1998, unpaid common expenses create a lien that the corporation can register after 10 days' written notice and enforce in the same manner as a mortgage, which includes power of sale. The lien expires after three months if it isn't registered.
If a Notice of Sale is on your table this week
Check the date it was mailed, work out the earliest sale date with the tool above, and ask the lender in writing for a statement of what is in default. Then decide between catching up, refinancing and selling while each is still open. If you would like a lawyer to look at the notice with you, Olanur can match you with an Ontario real estate lawyer for free.
Olanur Editorial Team
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