Comox Valley homes foreclosures are, unfortunately, a part of the Comox Valley Real Estate market. A home foreclosure is the legal process by which a mortgagee (lender) or other lien holder extinguishes the mortgager’s (borrower’s) right of redemption (the capacity to redeem the property and pay the loan). The borrower’s legal (contractual) right of redemption is already extinguished because the borrower has defaulted. Property foreclosure actions are commenced in British Columbia with a document called a petition. This action is normally preceded by a demand letter from the lender that gives the borrower a short period to pay out the mortgage or face foreclosure. The petition is followed by the first order of the court – the Order Nisi, which, among other things, establishes the amount required and time given to the borrower to redeem the mortgage.
While there are a number of remedies available for a home foreclosure, one of them involves a foreclosed property listed for sale as a court-ordered sale. This means that the sale of the property is carried out under supervision of the court and that the court must approve the sale. The property is appraised and then generally listed for sale with a real estate firm. Unlike most other Comox Valley homes for sale, a foreclosed home is advertised “as is, where is”. This means that prospective purchasers are responsible for undertaking the investigations necessary to satisfy themselves concerning the condition of the property. As well, no Property Disclosure Statement will be made available.
On any given day there are a number of foreclosures listed among the some home foreclosures in Courtenay. Should this cause concern? As with other Comox Valley realty listings, buyer’s should ensure that they gather as much information as they can on the property with the assistance of professionals in the respective areas so that they can be confident that they understand what they are considering buying and that their will be no surprises in the future. Even though the lender will not make any representations or give any warranties concerning the condition of the property, the listing real estate agent still has an obligation to disclose known latent defects of the property and that the disclosure be made in writing prior to acceptance of an offer (Section 58 of the BC Real Estate Council rules).
A few other things are different with home foreclosures. First, offers must provide for the lender to obtain court approval of the offer. Second, offers will have a Schedule A attached that comprises terms that replace, modify, and where applicable, override the Standard Contract of purchase and sale. Third, the completion date of an offer is based on a period of time after court approval (for example, two weeks). Fourth, when an offer is scheduled to be considered in court, other interested buyers may show up in court and present offers.
This short blog does not cover all aspects of a Comox Valley home foreclosure and it is not intended as legal advice – always consult a lawyer for legal advice. The blog is meant as informational so that readers will gain a basic sense that foreclosures are different than other real estate listings and sales. Whether or not they are viewed as a good or bad deal by prospective purchasers will depend on the individual circumstances at the time. Are you considering buying a Comox Valley home foreclosure? Contact Brett Cairns of RE/MAX Ocean Pacific Realty to find out how.
by Brett Cairns