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> potentially leading to their bankruptcy Whoa, you have to go bankrupt to stop paying a mortgage in Canada? In the US, these are (in my experience) secured, n
by asfasgasg 9y ago
> potentially leading to their bankruptcy
Whoa, you have to go bankrupt to stop paying a mortgage in Canada? In the US, these are (in my experience) secured, non-recourse loans. That means that the bank's final option is to take the house, but if they do that, you owe them nothing else.
- smnrchrds 9y ago> Whoa, you have to go bankrupt to stop paying a mortgage in Canada? It depends on which province your property is located at. In Alberta and Saskatchewan, mortgages are non-recourse. In the rest of the country they are not. So for the majority of Canadians bankruptcy is the only way to get rid of their mortgage. Admittedly in the specific example I gave this would not be the case. However to the best of my knowledge, defaulting on a non-recourse mortgage ruins your creditworthiness the same as declaring bankruptcy. Considering how many landlords and employers check your credit report, defaulting on a mortgage could have serious consequences for your livelihood, even if it is non-recourse.
- DrScump 9y agothe bank's final option is to take the house Sometimes not even that, in states with homestead exemption protections.
- asfasgasg 9y agoNormally the homestead exemption would protect the homestead from creditors other than the mortgage lender. Otherwise, it would be substantially impossible to induce banks to give mortgages.