Can I renew or refinance my mortgage if there is a lien on my Ontario property?
A construction lien registered on your title can get in the way of renewing or refinancing, and an owner can clear title by having the court vacate the registration. Whether a lender will renew or refinance with a lien in place depends on that lender, so raise it early.
The court shall vacate the registration once the full amount claimed is paid into court or security is posted, plus security for costs of the lesser of $250,000 or 25% of the claim. The court may also vacate the registration on payment of an amount it considers reasonable.
Unless it is preserved, a construction lien expires within the statutory period, which for a contractor is generally 60 days from the earlier of the listed events. A preserved construction lien expires unless it is perfected within 90 days after the last day it could have been preserved. For unpaid tax, CRA may register a certificate in the Federal Court and then register a document creating a charge on your property. How a CRA charge affects your renewal depends on the facts, so speak with a lawyer before you apply to renew.
Key takeaways
- A construction lien can be removed from title when the court vacates it after the full amount claimed is paid into court or security is posted.
- The court also requires security for costs of the lesser of $250,000 or 25% of the claim.
- A preserved construction lien expires unless it is perfected within 90 days after the last day it could have been preserved.
- CRA can register a charge against your property for an unpaid amount, so ask a lawyer how to clear it before renewal.