Probate Leads for Wholesaling in Canada

24 Replies

Hi all,

I am keen to start wholesaling in Ontario, Canada, and would like to know if anyone has had success generating probate lists here. From what I am seeing, probate lists aren't as accessible as they are in the U.S., but perhaps I'm missing something? 

Also, curious to hear if anyone has had good success wholesaling in Ontario? I am located in Toronto, but given the current market prices, I am looking to wholesale outside of the GTA.

Thanks!

Jeff

Originally posted by @Jeff C. :

Hi all,

I am keen to start wholesaling in Ontario, Canada, and would like to know if anyone has had success generating probate lists here. From what I am seeing, probate lists aren't as accessible as they are in the U.S., but perhaps I'm missing something? 

Also, curious to hear if anyone has had good success wholesaling in Ontario? I am located in Toronto, but given the current market prices, I am looking to wholesale outside of the GTA.

Thanks!

Jeff

 Hey Jeff, I have only ever personally met one successful wholesaler in Ontario, he did most deals miles from the GTA. My advice would be to call the bandit signs they put up and find one who is currently having success. Although if you come across anything in the waterloo region I may know a buyer.

@Jeff C. :  @Roy N. is absolutely right (as always), our privacy laws here in the north are just so much more restrictive than in the U.S. Really no such lists exist in Canada, despite what some companies or REI associations may try to tell / sell you. There is a company called Tri-Target that lists municipal tax sales throughout Ontario; this may be the nearest we can get to a distressed sales lists.

@Luc Boiron I've never used Tri-Target, no.  Their primary purpose seems to be offering title / lien searches of the properties being sold under municipal tax sales, and also they provide an aggregate list of those tax sales...they're basically and intermediary, so I'm pretty sure they are legitimate in what they do.  An important note is that you will be dealing directly with the municipality in the tender process, not Tri-Target.  There have been two properties I've considered putting bids on--both in northern Ontario--but haven't pulled the trigger yet!

@Roy N. You're right. I haven't looked at that either. I wasn't even thinking of municipal tax sales as a source of properties. I wonder if there are good deals to be had? I'd love to hear about the experience of buying tax sales in Canada if anyone has been through one.

@Jeff C. I found this in my search for understanding. It is a good description along with the two links at the bottom of the page:

http://www.ontariotaxsales.ca/how-to-buy/what-is-a...

What this does not seem to make clear is how to KNOW what you are buying instead of HOPING that you aren't buying an environmental disaster that bankrupts you or some Crown lein that halts your business for years of repayment. I'm not interested in investing blind into traps.

Originally posted by @Jeff C. :

@Roy N.@Matt Geerts  Interesting stuff. I am also not too clear on how to read this document. Are these all corporations that have defaulted on their tax payments? 

 Jeff:

In all provinces, the Gazette is the official publication/record of government business.  It is usually published as a single volume per year, but in weekly instalments.  It contains everything from business registration/change/dissolution, legal name changes (when an individual changes their name); changes to government regulation, rates, etc.; sale of surplus government assets (including property); Notice of Tax Sale on property.  

Here it NB, where we are also a "power of sale" province, the "Royal Gazette" includes Notices of Mortgage Sale (while Power of Sale is contractual between the Mortgagee and Mortgagor, it relies on underlaying legislation which requires publication of Notice).  I would not be surprised of Notice(s) of Mortgage Sale also appear in the Ontario Gazette.

Matt:

You are absolutely correct, a property purchased at tax sale comes with no assurances, so it is best to do your homework before bidding.

@Roy N. awesome guidance, as always!   Amazing that I--living in ONTARIO--was unaware of that publication which you recommend from New Brunswick.  Go figure!  But as @Matt Geerts alludes to above, it is also necessary to know about liens etc, and that's where services like the one I mentioned further up the thread (or a lawyer willing to do a la carte title searches) might come in handy I suppose.

As you say, @Roy N. "do your homework". I just don't even know where I would go to find out what that homework is! Is that link that I found on ontariotaxsales.ca comprehensive? Even it leaves some dangling questions about liabilities.

One is obvious - go there (or pay someone to) to find out if you're buying a gas station or hide tanning factory.

But will the title search and execution search reveal it all? I don't mind gambling a small fee to each interesting property to discover whether or not there is a problem, but to stumble into a million dollar liability will end me. Boom, bankrupt. Are tax sales only for those lucky people who can just deal with a million dollar loss?

Originally posted by @Matt Geerts :

As you say, @Roy N. "do your homework". I just don't even know where I would go to find out what that homework is! Is that link that I found on ontariotaxsales.ca comprehensive? Even it leaves some dangling questions about liabilities.

One is obvious - go there (or pay someone to) to find out if you're buying a gas station or hide tanning factory.

But will the title search and execution search reveal it all? I don't mind gambling a small fee to each interesting property to discover whether or not there is a problem, but to stumble into a million dollar liability will end me. Boom, bankrupt. Are tax sales only for those lucky people who can just deal with a million dollar loss?

 I'm sure Roy will have some great stuff to add, but I would start by buying it under a corporation. Of course, this is after your due diligence, but if you buy it under a corp and discover something horrible, you can just walk away and lose whatever you put in, without being responsible for cleaning up the property or other additional costs.

Thanks @Luc Boiron , yet another aspect of RE that little one-door-landlord me needs to drill into - incorporation.

Would the title search show a history of transfers? I'd expect to see an auction every 4 years on a property that has had "hidden" issues for a very long time. Someone buys it in a corp, walks away, taxes add up, someone buys it in a corp, walks away...

@Matt Geerts Even without a title search, a realtor can get you the history of transfers from the land registry.

Also, the city knows the properties for sale. If you talk to a planner for the city, or the person in charge of the tax sale, they tend to know if there are any environmental concerns and in my experience, are very useful resources to find out the history of the property. I don't mean that they know the details of every property, but if environmental concerns have come up in the past, it is likely they have heard about it.

This is very interesting. Has anyone been able to make anything out of a tax sale? I've done a bit of reading on it and it looks like one of the downsides is that the current owner could reclaim the property during the redemption period, at which point you will be refunded your money plus interest, but out a property that you were hoping for.

If they redeemed it say in 3 months and you get 25% (in Texas you would), would you consider that a good investment?  In Texas the penalty fee is not pro-rated.  You also should know that the vast majority of Texas tax sale properties do not get redeemed.

Arnie Abramson

@Arnie Abramson
The OP start to this thread was about probate leads in {Ontario} Canada.  I contributed to a slight derailment discussing tax sales.

Josh Evans raised the matter of the redemption period - it varies in length (45 - 90 days seems to be the range), but the terms are quite similar across the entire country.  If the property owner - or an agent on her/his behalf - pays the outstanding tax balance, plus all assessed penalties and interest within the redemption period, they retain the property.   As the purchaser, your capital, plus interest and, in some instances, reasonable expenses are returned to you.

Unlike your example for Texas, you are not going to receive a 25% return north of the 49th.