A lender called us yesterday about a file involving a senior couple who had defaulted on their reverse mortgage and were looking to refinance their way out of trouble. Our client wanted to help but had never dealt with a reverse mortgage before. Reverse mortgages are among the most misunderstood lending products in Canada. Many people assume a lender takes ownership of the home. Others view them as inherently predatory. It doesn’t help that every so often there’s a news story

A borrower stopped making all payments on a $263,000 second mortgage. Not one payment. Not principal, not interest, nothing. The lender commenced enforcement proceedings and after two years, the Ontario Superior Court issued its decision: 🙅‍♂️ It rejected every defence the borrower raised. 💪 The lender won. Sounds like a great result, right? 𝐍𝐨𝐭 𝐞𝐱𝐚𝐜𝐭𝐥𝐲. Upon obtaining a judgment, a lender asked that the borrower pay the roughly $237,000 legal bill the lender had

Quite often, the opposite is true. When we're asking for more information, we're usually trying to make the deal work, not kill it. The borrower's story needs to make sense. The property needs to make sense. And everyone's version of events needs to legitimately line up. So when we got an urgent residential mortgage file that needed some clarification, we picked up the phone. It was a seemingly simple question: “𝐖𝐡𝐲 𝐢𝐬 𝐭𝐡𝐞 𝐛𝐨𝐫𝐫𝐨𝐰𝐞𝐫’𝐬 𝐚𝐝𝐝𝐫𝐞𝐬𝐬 𝐝𝐢𝐟𝐟𝐞

He was worried that his money, loaned out on a residential property, was gone. What happened? The secured property was being sold and the Land Registry Office accidentally deleted his mortgage from title. Poof! A $460,000 first mortgage… gone. 💸 It was never paid out. 💸 Our client never agreed to discharge it. 𝐓𝐡𝐞 𝐋𝐑𝐎 𝐣𝐮𝐬𝐭 𝐦𝐚𝐝𝐞 𝐚 𝐦𝐢𝐬𝐭𝐚𝐤𝐞. And that mistake nearly sent our client into shock. This situation highlights a risk that doesn’t get enough attent

That’s the story of Carolyn Krebs, a Toronto landlord recently sentenced to 15 days in custody on top of a $120,000.00 fine for violations of the Ontario Fire Code. Ms. Krebs failed to comply with fire safety requirements at a rental property despite multiple warnings, putting tenants’ lives at risk. You can read this story as a landlord-tenant matter. But lenders should read it as a tale of collateral and operational risk. Fire Code violations can lead to: 🔥 Municipal work

Vacant home taxes. Luxury taxes. Foreign investor taxes. New York City’s proposed tax targeting certain high-end residential purchasers is the latest reminder that political risk plays a major role in real estate underwriting. Our clients are used to analyzing: 📝 Borrower risk 📝 Market risk 📝 Construction risk 📝 Interest rate risk But increasingly, 𝐭𝐡𝐞 𝐰𝐢𝐥𝐝𝐜𝐚𝐫𝐝 𝐬𝐞𝐞𝐦𝐬 𝐭𝐨 𝐛𝐞 𝐩𝐨𝐥𝐢𝐭𝐢𝐜𝐚𝐥 𝐫𝐢𝐬𝐤. Is it possible that a deal that works today may not

Commercial mortgages are underwritten based on a specific set of facts at a specific moment in time. But properties change. Sometimes quietly. Sometimes dramatically. 🚜 A farm becomes a wedding venue. 🏬 An office becomes residential. 🛍 An industrial site turns into a warehousing hub. And suddenly the property securing your loan no longer looks like the property you originally approved. Sometimes that change increases value. Sometimes it increases risk. And depending on you

One kingdom, many different realities. MPAC recently released its Business Properties Report examining Ontario’s commercial real estate market. And unsurprisingly, the market tells very different stories depending on the asset class. Multi-residential development has surged to levels not seen since the 1970s, family-sized rentals remain undersupplied and warehouse pricing has started to stabilize after years of rapid growth. Some asset classes are thriving. Some are not. Othe

It’s not the overleveraged 30-year-old chasing their third pre-con. It’s the 60-year-old adding new debt. 𝘘𝘶𝘪𝘦𝘵𝘭𝘺. Mortgage debt is now rising fastest among Canadians aged 55–64. Nearly 1 in 3 Canadians who are retired or approaching retirement continue to make mortgage payments on their principal residence, a 3.5x growth since 1999. 𝐓𝐡𝐚𝐭 𝐬𝐡𝐨𝐮𝐥𝐝 𝐦𝐚𝐤𝐞 𝐞𝐯𝐞𝐫𝐲 𝐩𝐫𝐢𝐯𝐚𝐭𝐞 𝐚𝐧𝐝 𝐚𝐥𝐭𝐞𝐫𝐧𝐚𝐭𝐢𝐯𝐞 𝐥𝐞𝐧𝐝𝐞𝐫 𝐩𝐚𝐮𝐬𝐞. These borrowers behave ve

You never know what’s going to appear on title. That lesson played an important role in the recent Ontario Court of Appeal decision in 𝐌𝐂𝐀𝐍 𝐇𝐨𝐦𝐞 𝐌𝐨𝐫𝐭𝐠𝐚𝐠𝐞 𝐂𝐨𝐫𝐩𝐨𝐫𝐚𝐭𝐢𝐨𝐧 𝐯. 𝐁𝐫𝐨𝐚𝐝. The situation: 🏚 A lender was trying to sell under power of sale. 🏛 There was a Certificate of Pending Litigation (CPL) sitting on title. 👩🏻‍⚖️ The lower court said it had no jurisdiction to discharge the CPL. 🙅‍♂️ The Court of Appeal disagreed. In the real world, C

The answer, at least in the US, is a fire sale. Commercial real estate across America is now trading at massive discounts compared to valuations from a decade ago. A $68𝐌 Chicago office just sold for $4𝐌. A $176𝐌 Denver complex for $5𝐌. These might look like bargains too good to pass up, but for lenders it means something else entirely. After years of extensions, restructuring, delaying losses and hoping for a rebound, reality finally set in. 𝐓𝐡𝐞 𝐮𝐧𝐝𝐞𝐫𝐥𝐲𝐢𝐧𝐠 ���

The Law Society of British Columbia recently grappled with this question in a case involving Edwin Soon, a real estate lawyer in Vancouver. Among other things, Mr. Soon ran a private lending business through his law firm’s trust account. Seem odd? That’s because it is. A lawyer’s trust account is not a business account. It’s not a holding account. And it’s definitely not there to make deals “look legitimate”. But in this case, that’s exactly what it was used for. In his own w