The British Columbia Real Estate Foreclosure Process

Foreclosure Information

Kamloops and area home listings including judicial sales and foreclosed properties click here.

Foreclosure Home For SaleThe foreclosure process is a mystery to many people. There are many misconceptions about purchasing a foreclosure property. It is more complicated than making an offer on a home that is not in foreclosure. I want to shed some light on the process and what buyers can expect. Also, if you have found yourself in a situation where you are nearing foreclosure, this will help you figure out what to do to avoid a judicial sale or foreclosure.

Judicial process begins with a demand letter sent to the borrower which gives the borrower a short amount of time to pay off the mortgage. Once the demand letter is sent to the borrower a petition is filed in the BC Supreme court which starts an action called the Order Nisi that gives a redemption time to the borrower. The redemption period, which is usually six months, is given to the borrower to redeem the mortgage. This can be done by the borrower attempting to sell the property.

After the Order Nisi, one of two things will happen. The petitioner will chose to have the property listed for sale by the court by way of a Judicial Sale through a Realtor. At this time, the lender will receive an order approving sale where the borrower will be responsible for any shortfalls between the borrowed amount of the mortgage and the sale amount.

The second option for the courts is an order of absolute foreclosure. If the redemption period has expired and if:
1. The property is worth the same amount as the mortgage debt or more,
2. The respondent borrower is judgment-proof (i.e. no assets or money to apply towards deficiency) or
3. There are no offers under a judicial sale; the lender can seek an absolute order of foreclosure, under which the lender becomes the new registered owner and all borrowers are wiped off title. No further action can be taken against the borrower after the court has granted the order absolute.

Once a judgment is placed against a property it is placed on the market with a Realtor. At this point a buyer can make an offer on this property. The purchase process for a foreclosed property is not like a property that is normally listed that is not under foreclosure. What happens is:
1. The buyer makes an offer to purchase the property and there is a subject period where the purchaser removes subjects such as home inspection, title search etc.
2. The subject free offer goes to court. Once in court the vendor’s lawyer presents the offer to the judge. (known as the Master in Foreclosure proceedings)
3. The Master asks if there are any other parties in the courtroom who want to submit an offer. If not, and the offer is market value, the Master will approve the sale. If there are competing offers the Master will instruct all parties including the original purchaser to leave the courtroom and resubmit their final subject free offer in a sealed, envelope to the vendor’s lawyer.
4. After all offers have been submitted the Master reviews the offers and approves the best offer.

All offers made at the court level must be subject free offers. As you can see, buying a foreclosed property is not as simple as many think. Even if you have an accepted offer on a foreclosed property, there is a high likelihood that there will be other offers once you reach the court proceedings.

I have not seen many foreclosures or court ordered sales come on to the Kamloops market recently. I do believe however, that we will see an increase in foreclosures and court ordered sales in 2009 and into 2010. Many home owners are over extended with debt not only in their homes but also personal credit card debt, personal loans and loans on vehicles.

Open House Weekend: February 14 & 15, Kamloops

Kamloops Open Houses

For up to date Kamloops and surrounding area home listings click here.

Open houses this weekend are in Aberdeen, Juniper Ridge, North Kamloops, South Kamloops and Westsyde.

Saturday, February 14th: 1966 Kechika Street, Juniper Heights 12-1

Kechika Street, Juniper Heights, Kamloops3+2 Bedrooms 4 bathroom home. Beautiful inside and out. Fully finished, walk out basement. Hardwood floors, carpet and tile throughout. $519,900

Saturday, February 14th: #22-2050 Qu’appelle Blvd, Juniper Heights 1:30-2:30

Quappelle Blvd, Juniper Heights, Kamloops4 bedroom, 2 bathroom townhouse. Private, fenced back yard. Master bedroom and laundry on the main floor. Double garage. $289,900

Saturday, February 14th: #10-1155 Hugh Allan Drive, Aberdeen 3-4

Hugh Allan Drive, Aberdeen, Kamloops3 bedroom, 2 bathroom townhouse. Close to shopping. Beautiful view. Generous room sizes. Open & bright floor plan. $219,900

Sunday, February 15th: 755 Porterfield Drive, Westsyde 12-1

Porterfield, Westsyde, Kamloops

2+1 bedroom, 2 bathroom 1/2 duplex. Gourmet kitchen with large pantry. Showroom quality. Vaulted ceilings. Single car garage. $319,900

Sunday, February 15th: 693 St. Paul Street, South Kamloops 1:30-2:30

St Paul Street, South Kamloops2+1 bedroom, 1 bathroom Bungalow. One of the cheapest single family homes in the area. Den and bedroom in the basement. Bring your updating ideas. $214,900

Sunday, February 15th: 1143 Surrey Ave, North Kamloops 3-4

Surrey Ave, North Kamloops3+1 bedroom, 2 bathroom. Newly reno’d bathrooms. Hardwood floors on main. Newer kitchen. Large bright basement. $269,900

A Growing Number Of British Columbians Think This Is A Good Time To Buy A Home

B.C. Real Estate News

I found the article below on the Vancouver Sun’s website by Derrick Penner. The Kamloops real estate market has recently seen a bit of a pick up in the number of buyers actively looking for a home as well as the number of sales reported. I personally have seen an increase in the number of first time home buyers beginning to search. In the last few weeks there has been a few good days of reported sales from the Kamloops Real Estate Board, but we are still reporting sales down around the 2003 levels. Read the article below detailing the Ipsos Reid survey on the conditions of the real estate market in BC.

The poll found that some 71 per cent of respondents said it is a somewhat good or very good time to buy real estate. More people thinking about buying real estate, but majority say it’s not a good time to sell property. In November, only 60 per cent of respondents told Ipsos Reid it was a good time to buy. In the latest poll, 82 per cent said now is not a good time to sell a home. Hanson Lok, senior research manager at Ipsos Reid in Vancouver, said as market conditions improve for buyers, there also seems to be a growing number of British Columbians gathering on the sidelines to contemplate buying new homes.

Three in 10 respondents said they were considering a purchase in the next two years, up from 20 per cent when the same question was asked in November. “We are seeing a greater number of first-time home buyers in particular looking to take advantage of more affordable homes, incentives from the government and lower costs of borrowing,” Lok said in a news release. The new poll also found that British Columbians’ expectations for falling prices have been muted since November.

While the B.C. Real Estate Association has forecast price declines of 13 per cent in 2009 and Canada Mortgage and Housing Corp. is predicting drops of around 10 per cent in Metro Vancouver, only 42 per cent of respondents to the recent Ipsos Reid poll said they expected prices to be lower 12 months from now. That is down from November, when 57 per cent said prices would be lower a year later.

Across the Lower Mainland, including Metro Vancouver and the Fraser Valley, respondents’ expectations were for a further 2.3-per-cent decline in prices. Across the rest of B.C., respondents believe prices will drop another four per cent. Statistics Canada reported new-home price data for December showing that in Metro Vancouver, prices had fallen 2.3 per cent from the same month a year ago.

Vancouver’s price decline was the fourth steepest among cities on the downside of their cycles following Victoria, Calgary and Edmonton, which saw the steepest year-over-year drop of 8.2 per cent. Victoria’s decline in December was about three per cent from the same month a year ago. Nationally, the housing price index declined by one-tenth of a percentage point from November to December, which weighed on gains made in the measure over the year. The national HPI for December was up 0.4 per cent compared with the same month a year ago.

Housing Market in Kamloops Slows Down

Kamloops Real Estate News

This article is from the Kamloops Daily News and written by Staff reporter Jeremy Deutsch. This story is from the Wednesday, February 11th, 2009 paper. He states that housing starts are down, as I already expected. There is a lot of news in the media these days about the slumping real estate market not only in Kamloops but in North America. It will be interesting to see what the statistics are for housing starts and residential housing sales in the next couple months. I suspect that we will continue on this trend downwards, but it is pretty difficult to predict the future! Read below for the full article.

Following a trend of declining figures in housing sales and city building permits, the number of housing starts in Kamloops has also taken a dip. Statistics produced by the Canadian Housing and Mortgage Corporation (CMHC) show the 62 housing starts in January were down five per cent from 2008. But the small decline is deceiving, as the number of starts were boosted by one apartment project that began construction during the month.

A closer look reveals six single-detached housing starts, a decrease of 70 per cent from 20 which began in January 2008. Paul Fabri, a market analyst with CMHC, noted the numbers coming out of Kamloops are similar to those across the region. “We’ve seen economies in Kamloops, B.C. and North America begin to experience slower growth and that will mean less demand for housing.” he said.

Kelowna saw a 94 per cent decrease in housing starts last month, while Vernon dropped by 85 per cent. Fabri explained Kelowna’s market, compared to Kamloops is driven by demand for discretionary, resort or secondary housing, which has cooled off considerably, given the economic downturn. He surmised the slower pace of employment growth as the issue in Kamloops.

The CMHC isn’t expecting a quick turnaround either, predicting housing starts will stay low for most of the year.  Fabri also pointed out the last couple of years have been so hot, the number of housing starts now are similar to those during the 1990’s.

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