What happens if I fall behind on my mortgage, and how much time do I have?

What happens the moment a payment is missed

The mortgage is in default under its own terms as soon as a payment is missed, though many mortgages allow a short period before treating it that way. Lenders typically contact you directly first, by phone or letter, and may report the missed payment to a credit bureau; none of this requires a court process on its own.

Contacting the lender before, rather than after, a payment is missed usually opens more options than waiting.

The notice periods the Mortgages Act requires

Where a mortgage's own terms confer a power of sale on default, Ontario's Mortgages Act does not allow a lender to give notice of exercising that power until the default has continued for at least fifteen days, and does not allow the sale itself for at least thirty-five days after that notice is given. The notice must go to every person with a registered interest in the property, not only the owner.

These are minimums; many lenders in practice allow more time, but the Act does not require it.

Relief options a lender may offer

Nothing in Ontario law requires a lender to offer a deferral, a temporary interest-only period, or an extended amortization, but many will consider one if asked before the arrears grow large. These arrangements are contractual, negotiated case by case, and vary widely between lenders; there is no standard entitlement to any of them.

A private lender under a shorter-term mortgage may have less flexibility to offer relief than a bank or credit union.

What follows a sale, if it happens

If the property is sold under a power of sale, the proceeds are applied first to what is owed on the mortgage, then to other registered interests in order of priority. A shortfall, if the sale does not cover the debt, generally remains owed and can still be pursued; a surplus after every registered interest is paid belongs to the owner.

A court application, rather than the statutory notice process, is a separate route some lenders use instead, with its own procedure.

A lawyer can review a Notice of Sale for you, check that the Mortgages Act's notice periods were actually met, and account for any shortfall or surplus after a sale.