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If there is a shortfall after the bank forecloses, CMHC (Canada Mortgage and Housing Corporation) steps in, pays the bank, and then pursues the client for the remaining balance.
You have the right to challenge a foreclosure if you think your lender made a mistake or has violated the law. A notice of preforeclosure does not mean you need to vacate the home.
You will be entitled to any equity in the property after the bank sells it, however, there will be legal and selling costs to cover. The property may sell below market price, and if you had an insured mortgage you can be sued for any remaining balance.
You may be able to avoid foreclosure by making arrangements with your lender, such as getting forbearance or agreeing to a loan modification. Other options may include refinancing with a hard money loan or reverse mortgage.
STOPPING FORECLOSURE In Alberta ? You Have Options. Once the demand letter comes, you have a few options in Alberta. The option that your lender will appreciate the most is if you repay the arrears. If you start communicating at the first missed payment, generally just getting that payment caught up is enough.