10/30/2026
Shortfall after a power of sale in Ontario: In Ontario, a lender can still sue when a power of sale falls short.
What this covers: a lender suing for a shortfall, a personal promise to repay and a time limit on a shortfall lawsuit.
Myth: “Once the bank sells my house under power of sale, the debt is gone.”
The myth, answered: The sale pays down the debt but may not clear it.
The fine print:
A shortfall lawsuit needs a personal promise to repay.
Most mortgages carry one, but not all.
A time limit also applies to that lawsuit.
Save this for when you need it, or share it with someone who does.
About Treadstone Law: Treadstone Law is a digital law firm serving clients across Ontario. We provide flat-fee real estate closings from the comfort of home. Our services are completely digital, so you can buy, sell, or refinance Ontario real estate from anywhere. Legal services are provided by licensed lawyers.
General information, not legal advice.
Link in the first comment.
