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May 24, 2021


Post XLI started an in depth look at power of sale litigation. The previous Post XLVI began an exploration into which debts owing by the mortgagor to the mortgagee should be included in the statement of claim. Obviously, principle and interest and, as well, interest on overdue interest, should be included. But what about the out of pocket costs that have been incurred by the mortgagee?

The amount of these out of pocket costs incurred by the mortgagee and the various types of these costs will depend, to a large degree, on when the statement of claim is issued by the mortgagee. If the mortgagee starts to enforce its mortgage by issuing a statement of claim, then there would usually be no costs (or very limited costs) incurred at that early stage. But if the issue of the statement of claim is delayed until sometime after the notice of sale has been issued and the redemption period expired, there may very well be more significant costs incurred that the mortgagee will want to be able to recoup. And if the statement of claim happens to be issued towards the end of the entire mortgage remedy process, there may very well be hundreds if not thousands of dollars of costs incurred.

These costs might include outstanding realty taxes, insurance premiums, locksmith charges, cleaning the mortgaged property, storing the mortgagor’s personal property that was left at the mortgaged property, snow shoveling, winterizing, gardening, roof and other repairs. The list goes on and on.

While some lenders like to see all of itscosts incurred included in the statement of claim, I do not believe that that is the most advantageous way to go for a mortgage lender. I like to keep my statements of claim simple and straight forward, including only a  monetary claim for principle and interest and if significant, realty taxes that the mortgagee has paid on the mortgagor’s behalf.

The next post will explain why I take this approach. As always, this blog is intended for information purposes only. It is not legal advice and cannot be relied on as such. Nor is it a substitute for hiring your own legal counsel, who will be an essential member of your mortgage default and power of sale team. And lastly, this blog is just my opinion. I reserve the right to change my mind. And I reserve the right to be wrong.

Be well and stay healthy.