A: Mortgages usually contain a clause stating that you agreed to pay your lender “its solicitor/client costs” or to pay back the lender for its costs of enforcing its loan on a “full-indemnity basis.” This means that you have agreed to pay the lender any reasonable legal cost, or other expense, that your lender incurs through the foreclosure process.
The costs you have agreed to pay will usually include:
1. The full fees and out of pocket costs of the lender’s lawyer;
2. An appraiser’s fees;
3. A house inspector’s fees;
4. All costs incurred to your lender through the up-keep of the premises if you abandoned the house (e.g. hiring someone to shovel the walks in winter);
5. All reasonable lender fees. You will be expected to pay for the time spent on your file by the bank’s employee, as well as any other fees that the bank may charge. It is worth noting that as of 2009, Alberta’s courts have begun to review these fees more closely, and have rejected $150.00 NSF fees for a missed payment or $500.00 for having an employee give instructions to their lawyers;
6. Other costs (e.g. bringing in tradespersons to fix damage to the property that occurred during the move-out, paying property tax owing, paying utilities owed from when the property was still in your name).
It is important that you do nothing to increase these costs, as they form part of the judgment against you. This can happen as follows:
A. Judgment for amount owing on mortgage $100,000.00
B. Costs (totaled up) $ 60,000.00
TOTAL AMOUNT OWING $160,000.00
The courts will pay attention to the costs being levied against you, and will order them to be lowered if they find the costs to be excessive. You can challenge these costs if you can prove that they are excessive via a court officer called the “Taxation Officer.” Taxation Officers are court officials who examine legal bills to ensure that they are in line with the services provided.
>>Back to Q & A - Debt