Do you know someone or are you someone that may be concerned about making their mortgage payments?

It could be incredibly stressful to think about the unknowns, so let’s work through a few steps that may lead to some options:

Step 1: Income Assistance

Maybe there is a program that can help one or more people in the household to contribute to making the payments. Here are a few options to check out if you haven’t worked through them already:

This information is accurate as of December 18, 2020 and may change due to program changes. Please double check the linked websites before making any decisions.

Employment Insurance (EI)

• Who Qualifies?

  • Anyone who has worked a minimum of 120 hours in the past 52 weeks and;

  • Has lost their job for reasons that are not their fault, or left work temporarily due to leave.

• How Much Would I Receive?

  • $500 per week, or;

  • $300 per week for extended parental benefits

Canada Recovery benefit (CRB)

• Who Qualifies?

  • This benefit replaced CERB, and applies to workers who aren’t eligible for EI

  • This includes self-employed freelancers and gig-economy workers

  • If you’re still working but your income has dropped by 50% due to COVID-19, you are eligible.

• How Much Would I Receive?

  • $500 per week for up to 25 weeks

Canada Recovery Sickness Benefit (CRSB)

• Who Qualifies?

  • Any workers who are unable to work due to being sick with COVID-19 or have to isolate due to COVID-19, or have to stay home due to being highly susceptible for COVID-19.

• How Much Would I Receive?

  • $500 per week for 2 weeks

Recovery Caregiving Benefit (CRCB)

• Who Qualifies?

  • Anyone who has to care for a child under 12 years old, who’s school or daycare has closed due to COVID-19, or has to quarantine for COVID-19 reasons, and works less than 50% of the week due to this.

• How Much Would I Receive?

  • $500 per week for up to 26 weeks per household

Step 2: Additional Deferral Options Through Your Lender

Some people may feel uncomfortable calling their lender and letting them know that they are unable to make their payments, but this may be a good option.

The Government of Canada facilitated banks to offer mortgage deferrals to families financially affected by COVID-19, but some lenders have said they’ll work with borrowers on a case-by-case basis if they are unable to resume regular payments.

Step 3: Seek Refinance Options

Contact your bank and/or Mortgage Broker/Specialist from our HACK&Co Trusted Expert List to talk about options to access the equity in your home to restructure debt in more manageable ways.

Step 4: Consult with Debt Consolidation Experts

In situations where the income won’t meet the payments, maybe the payments can move to meet the income. Talk to a Debt Consolidation Expert from our HACK&Co Trusted Expert List to look at options to reconfigure your debt into a more manageable structure.

Step 5: Sell the Property to Access Remaining Equity

In Canada, if a property were to go into foreclosure and be sold for an amount that is more than the mortgage owing and the costs associated with the foreclosure process, the remaining amount would go back to the person who owed the property.

The foreclosure process doesn’t allow for the normal representations and warranties that are included in most Purchase Agreements and will often be seen as higher risk by a buyer. So, the foreclosure process itself will normally result with a sale value that is under market value for similar properties that are being sold by their owner. Plus, banks are set up well to finance properties, but not for property management and the purchase and sale of properties, so there are significant costs associated with bank foreclosures that aren’t present in most residential transactions.

With that being said, it may be much better for the homeowner to sell the property even if it’s at a loss because it could be at less loss than letting the foreclosure process play out.

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