Introduction
Buying a foreclosed home is an increasingly popular choice among buyers in Quebec. With the ongoing escalation of real estate prices in Montreal, the South Shore, the Eastern Townships and the Laurentians, these homes can offer a real path to ownership — sometimes below market value.
This article is intended as a detailed guide to answer the most frequently asked questions:
- What is a foreclosure?
- Why buy a foreclosed home?
- How do I buy a foreclosed home?
- How do I find Desjardins homes and other foreclosed homes?
- What are the benefits?
- What are the risks?
- How can I protect myself?
- How can I negotiate a foreclosure?
Moreover, I will provide detailed information about the Montreal area, the South Shore of Montreal, the Eastern Townships and the Laurentians.
In 2023, 220 foreclosed properties were listed for resale across the Montreal, Montérégie (including the South Shore), Estrie and Laurentians regions. By 2024 that figure had risen to 320 listings. Note that the regional table below counts properties sold, which accounts for the difference between the two series.
Reference guideThis post covers the buying side. The full legal mechanism, the updated Land Register figures and the options open to an owner in default are all gathered in my reference guide.
Read the complete 2026 guideWhat is a foreclosure?
A foreclosure — also called a repossession — is a situation where the lender reclaims the home because the borrower is in default. When you take out a mortgage, the lender takes the home as security and reserves the right to exercise a hypothecary recourse if you fail to meet your obligations.
Quebec law provides two distinct recourses, and they are not interchangeable. Both are set out in full, with timelines and the most recent figures, in my complete guide to foreclosure in Quebec.
1. The taking in payment
A taking in payment is exercised by the hypothecary creditor — most often a financial institution. When the homeowner defaults on their mortgage, the creditor holding security on the home first registers a notice of exercise, also called a 60-day notice, in the land register.
If the homeowner does not settle the arrears or cannot reach an agreement with their financial institution, the lender may take the property in payment of the debt. This is known as a taking in payment.
What a taking in payment actually changes
The effect is worth understanding clearly, because it is often misstated. A taking in payment extinguishes the debt (article 2782 of the Civil Code of Québec). The creditor becomes the owner of the home in full payment of what was owed. The former owner loses the property but owes the creditor nothing further. The creditor then resells the property like any other owner: it keeps the profit if the value exceeds the debt, and absorbs the loss if it does not.
Note also that a taking in payment is not automatic once the 60-day notice expires. If the owner does not voluntarily surrender the property, the creditor must apply to the court for forced surrender.
Source — art. 2782 C.C.Q.; art. 2767 and following for surrender. LégisQuébec2. The sale under judicial authority
A creditor generally chooses a taking in payment when it expects the market value of the property to exceed the amount still owed, since it will keep any surplus on resale.
Where the debt exceeds the value of the property, the creditor will normally opt instead for a sale under judicial authority. Because the creditor is not becoming the owner in that case, it retains a personal claim against the former owner for any shortfall remaining after the sale.
Default is not limited to missed mortgage payments. Depending on the terms of the deed of hypothec, it may also include failing to insure the property, failing to pay municipal or school taxes, or allowing the building to deteriorate to the point of reducing the creditor’s security.
Other creditors: Revenu Québec and municipalities
Banks are not the only creditors involved. Revenu Québec also has seized properties sold and assigns the mandate to real estate brokers.
Municipalities, however, use a separate mechanism that should not be confused with a taking in payment: the sale of immovables for non-payment of property taxes, governed by articles 1022 and following of the Municipal Code of Québec. It is a public auction held once a year by the RCM or the city, not a sale listed through a broker.
Tax sales: the one-year right of redemption
The distinction matters a great deal to a buyer. The full price is payable on the day of the auction, no viewings of the properties are arranged, and — most importantly — the former owner keeps a one-year right of redemption: they may buy the property back by paying the successful bidder the price paid plus 10%. The bidder cannot object. Until that year has elapsed, the bidder may not renovate or alter the property, and only obtains final title once the delay expires.
Source — Municipal Code of Québec, art. 1022 and following; art. 1057 and following for the right of redemption. LégisQuébecWhy buy a foreclosed home (pros and risks)
Buying a foreclosed home has advantages but also risks. It is essential to carefully weigh both sides to make an informed decision.
Financial benefits of a foreclosure
- Price sometimes below market: the asking price generally reflects the condition of the building and the market value of the area, not a liquidation price. Where a discount does exist, it usually corresponds to what you are taking on: the absence of a legal warranty, deferred maintenance, and the absence of a seller’s declaration. Room to negotiate almost always remains.
- Quick profit potential: one of the most appealing aspects of buying a foreclosed home is the opportunity to make a quick profit. Experienced buyers often purchase a foreclosed house to renovate and resell it at a higher price, maximizing their capital in a short period.
- An institutional seller with no attachment to the property: the institution has never lived in the home and decides on numbers rather than emotion. How quickly it moves depends on the market, however: in a slower market, timelines stretch and the institution puts more effort into selling.
- Reduced competition: another advantage is the potential for reduced competition. This is especially true for properties that require significant work, as the additional investment and effort may deter many buyers.
Disadvantages and risks of buying a foreclosed house
Purchase without legal warranty. This is a sale without a legal warranty, at the buyer’s own risk. Having never lived in the house, creditors have very little knowledge of the property and will therefore be released from any liability if a latent defect is discovered after the sale.
So what does a purchase without a legal warranty mean, and what should the buyer know?
The legal warranty of quality, precisely
The legal warranty of quality requires the seller to warrant that the property is free of latent defects at the time of sale (article 1726 of the Civil Code of Québec). It applies whether or not the seller knew of the defect — the seller’s knowledge affects only the extent of the damages that may be owed, not the existence of the warranty itself. A defect is considered apparent, and therefore not covered, when a prudent and diligent buyer could have detected it without needing to resort to an expert.
Source — art. 1726 C.C.Q.; art. 1728 C.C.Q. for damages.Examples include the presence of mold discovered during renovation work, water infiltration, crumbling foundations, and so on.
In such a case, the legal warranty allows the buyer to act against the seller to obtain compensation to resolve the problem, or a reduction of the initial sale price.
Your actual recourse for a latent defect
When you buy a foreclosed property sold without legal warranty, your recourse in the event of a latent defect is in practice non-existent. The legal basis differs depending on the mechanism, however, and the distinction can matter. In a sale under judicial authority, the law itself removes the warranty of quality (article 1731 C.C.Q.) and the exclusion is absolute. Following a taking in payment, the institution resells as an ordinary seller and the exclusion is contractual — and a seller cannot exclude liability for a defect it knew of or could not have been unaware of (article 1733 C.C.Q.). Have your situation reviewed by a notary before signing.
Source — art. 1731 C.C.Q.; art. 1732–1733 C.C.Q.A pre-purchase inspection conducted by a qualified inspector is therefore not just recommended but essential, in order to obtain the best possible assessment of the home’s condition. However, it is important to know that latent defects are by definition invisible, even to a competent inspector.
- Limited information: very little information about the home and its features will be available, as the owner is no longer involved.
- Additional costs: expect additional costs such as maintenance and, sometimes, major renovations that must be paid up front. There are also less common costs, such as a new certificate of location. If the certificate of location is more than roughly ten years old — a threshold generally applied by lenders and notaries — or does not reflect the changes made to the property, you will have to pay for a new one.
- Possible competition for the best offers: be prepared for some properties considered a “good deal” by buyers to receive multiple promises to purchase, with banks making counteroffers to obtain more.
- Potential difficulties in obtaining financing: financing can be a significant hurdle depending on the financial institution and the property’s condition.
Summary table: pros and cons
| Advantages | Disadvantages |
|---|---|
| Price sometimes below market, in exchange for the risk assumed. | Sale without legal warranty, at the buyer’s own risk. |
| Potential to quickly increase equity through resale after renovations. | Limited information available about the house and its history. |
| Institutional seller: decisions driven by numbers, not emotion. | Additional costs (maintenance, major renovations, certificate of location). |
| Less competition on some properties that require work. | Risk of multiple offers and bidding wars on good opportunities. |
| Investment opportunities for seasoned buyers. | Potential difficulties obtaining financing depending on the property’s condition. |
| Possibility of getting a good financial deal. | Risk of latent defects not covered by any warranty. |
| Sometimes more flexible negotiation with the bank. | Pre-purchase inspection is essential but does not guarantee there are no issues. |
How to find foreclosed homes for sale
Foreclosed homes can be found by consulting the land register or financial institution websites — for Desjardins foreclosures, for example — which is what real estate professionals do.
As a buyer, the most advantageous route is through a broker. This ensures you are promptly notified of new listings and, more importantly, grants you access to all the pertinent information about the property.
For buyers, the Centris website is an ideal resource for gaining an initial understanding of the foreclosed properties for sale in a specific area, be it Desjardins foreclosures or others.
Let’s take a practical approach by searching for a waterfront cottage for sale in the Eastern Townships. Here is a step-by-step guide to obtaining the search results.
Step 1 — Go to centris.ca
On the homepage, make sure the Residential option is selected, then click in the search bar and type the region you are looking for.
Step 2 — Open the filters and choose the property type
Click the Filters button to the right of the search bar. In the Property type section, check the Cottage option to filter results by this type of property.
Step 3 — Check the Waterfront feature
In the Features section, check the Waterfront option to show only cottages located by a body of water.
Step 4 — Check Repossession under Other criteria
Scroll down to the Other criteria section, then check the Repossession option. Next, click the Search button to display the results.
Going furtherCentris is not the only way in. My reference guide sets out three other routes to spotting a foreclosure, and how to be notified of new listings as soon as they go live.
Find a foreclosureStep-by-step guide: how to buy a foreclosed home
Buying a foreclosed home requires close attention. Here is a summary of the main steps.
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Determine your budget and obtain bank pre-approval
Before you embark on buying a foreclosed home, it is crucial to have your finances in order. Pre-approval demonstrates the seriousness of your offer and prepares you for the swift process that follows once your offer is accepted: the deed of sale and occupancy date are usually set very shortly afterwards. Experienced buyers often opt for a large down payment, or even cash, to secure a good deal.
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Work with a real estate broker
As mentioned earlier, buying a foreclosed home requires due diligence. This makes it all the more important to be advised and represented by a professional. Your real estate broker:
- will advise you on a home sold without a legal warranty;
- will conduct a comparative market analysis so you can decide on the price to include in your promise to purchase;
- will guide you through the pre-purchase inspection, a crucial step in understanding the property’s condition;
- will refer you to other professionals if additional expertise is needed;
- will negotiate on your behalf;
- will protect your interests throughout the process.
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Identify your criteria and objectives precisely
Determine your needs and desired lifestyle based on your family situation, your short-, medium- and long-term goals, and your tastes.
This will allow your real estate broker to search for properties that match your criteria and to alert you as soon as new foreclosures appear on the market.
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Perform thorough due diligence
- Your real estate broker will review all available real estate documents.
- It is essential to have a pre-purchase inspection conducted by a qualified professional. You will need to inform them that the house is being sold as a foreclosure, without a legal warranty.
- This will allow you to estimate the extent of the work to be done as accurately as possible, avoid unpleasant surprises, and prioritize the work if you do not want to do everything at once.
- If documents required to verify title or obtain financing are not provided by the creditor, they must be ordered. One example is the certificate of location, an original record prepared and held by a land surveyor.
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Negotiate your offer effectively
If a real estate broker represents you, they will advise you and draft the promise to purchase with you, guiding you through the pricing strategy in light of the property’s specifics.
- If a real estate broker does not represent you, you will be responsible for the price, conditions and clauses.
- It is not uncommon for banks — Desjardins, for example — to receive multiple offers for the same property and to return with a counteroffer to negotiate better terms, such as faster occupancy or a better price.
- Be prepared to pay a deposit with the promise to purchase, which will be deductible from the sale price.
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Secure your financing quickly after the promise to purchase is accepted
When buying a foreclosed home, it is advisable to take possession as soon as possible after the inspection, to ensure the property remains in the same condition. Financing is therefore the most urgent condition to fulfill. If you plan to pay cash, sign the deed of sale at the notary as soon as possible. If you are financing your purchase or renovations, the lender may require an appraisal by a chartered appraiser. You must act quickly, hence the importance of arranging financing before finding the property.
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Prepare your home insurance
Finding home insurance is another point to address as soon as the offer is accepted. This can be more difficult for a foreclosed, abandoned or unoccupied home.
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Finalize the sale at the notary’s office
Once the conditions are met, the documents are sent to the notary and the transfer of ownership occurs upon signing the deed of sale. You are now the owner and entirely responsible for the property.
Regional statistics on foreclosed properties in Quebec (2023–2025)
Foreclosures — active listings and properties sold, by region
| Region | Active listings, March 2025 |
Increase 2024 vs 2023 |
Sold in 2024 |
Sold in 2023 |
Sold in 2022 |
|---|---|---|---|---|---|
| Montréal | 4 | 110% | 21 | 10 | 8 |
| Montérégie | 13 | 116% | 69 | 32 | 32 |
| Estrie | 5 | 20% | 18 | 15 | 29 |
| Laurentides | 13 | 95% | 43 | 22 | 51 |
Swipe the table horizontally →
- Montreal: Montreal saw a 110% increase in foreclosures sold in 2024 compared to 2023.
- Montérégie: Montérégie, including the South Shore, also saw a notable increase in the number of foreclosures sold in 2024 compared to 2023. The number more than doubled.
- Estrie: Estrie saw the number of foreclosures sold rise by 20% between 2023 and 2024, a markedly more moderate increase than elsewhere.
- Laurentides: popular for second homes, this region offers attractive opportunities, particularly for waterfront cottages in foreclosure, acquired during the pandemic and currently experiencing financial difficulties due to rising interest rates. The number of properties sold in foreclosure nearly doubled between 2023 and 2024, rising by 95%.
- A necessary note of perspective: in both Estrie and the Laurentians, the number of foreclosure sales in 2024 remains below the 2022 level — 18 versus 29 in Estrie, and 43 versus 51 in the Laurentians. This is a rebound from a 2023 low rather than a continuous upward trend.
Frequently asked questions about foreclosures
Is a foreclosed home always sold below market value?
No. The asking price generally reflects the condition of the building and the market value of the area, not a liquidation price. Where a discount does exist, it usually corresponds to what you are taking on: the absence of a legal warranty, deferred maintenance, and the absence of a seller’s declaration. Room to negotiate almost always remains.
After a taking in payment, does the former owner still owe the bank money?
No. A taking in payment extinguishes the debt (article 2782 of the Civil Code of Québec). The creditor becomes the owner of the home in full payment of what was owed: the former owner loses the property but owes the creditor nothing further. The situation is different in a sale under judicial authority, where the creditor retains a personal claim for any shortfall remaining after the sale.
What is the difference between a taking in payment and a sale under judicial authority?
In a taking in payment, the creditor becomes the owner of the property and the debt is extinguished; it then resells like any other owner, keeping the profit or absorbing the loss. In a sale under judicial authority, the property is sold under the authority of the court without the creditor becoming the owner, and the creditor keeps a claim against the former owner for the shortfall. Creditors generally choose a taking in payment when the market value exceeds the amount still owed.
Do I have any recourse for a latent defect on a foreclosed property?
In practice your recourse is non-existent, but the legal basis differs depending on the mechanism. In a sale under judicial authority, the law itself removes the warranty of quality (article 1731 C.C.Q.) and the exclusion is absolute. Following a taking in payment, the institution resells as an ordinary seller and the exclusion is contractual — and a seller cannot exclude liability for a defect it knew of or could not have been unaware of (article 1733 C.C.Q.). Have your situation reviewed by a notary before signing.
Is a municipal tax sale the same thing as a foreclosure?
No. A tax sale is the sale of immovables for non-payment of property taxes, governed by articles 1022 and following of the Municipal Code of Québec: a public auction held once a year by the RCM or the city, with no broker and no viewings. The full price is payable on the day of the auction, and the former owner keeps a one-year right of redemption allowing them to buy the property back at the price paid plus 10%. Until that delay expires, the successful bidder may not renovate or alter the property.
How do I find foreclosed homes for sale in Quebec?
You can consult the land register, financial institution websites — Desjardins foreclosures, for example — or filter Centris listings using the “Repossession” criterion. Going through a broker remains more advantageous: you are notified as soon as a property is listed and you get access to all available information. My complete guide to foreclosure in Quebec sets out the other search routes.
Conclusion: buying with caution and vigilance
Buying a foreclosed home in Quebec can represent an attractive opportunity to save money, particularly in sought-after areas such as Montreal, the South Shore, the Eastern Townships or the Laurentians. However, be vigilant:
- Always have a thorough professional inspection performed.
- Carefully check the title and any outstanding debts and taxes.
- Don’t be seduced by the low price: assess the property’s condition to avoid unpleasant surprises.
- Act quickly, but be realistic about your financial capacity.
Foreclosed properties remain rare. The Quebec Land Register recorded 478 prior notices of exercise across the province in July 2026, down from 536 a year earlier — a decrease of 10.8% year over year.
One clarification is essential: a prior notice of exercise is not a foreclosure. The overwhelming majority of defaults are resolved through an arrangement, a refinancing or a voluntary sale, without the property ever being put up for sale by a creditor. For informed and well-prepared buyers, however, these properties can present real opportunities.
More recent dataThe figures above cover 2022 to 2024. For the updated Land Register numbers, and for what an owner can still do after receiving a prior notice of exercise, see my 2026 guide.
Complete 2026 guideSources and methodology
- Civil Code of Québec, articles 1726, 1731, 1733, 2758, 2778 and 2782 — LégisQuébec
- Municipal Code of Québec, articles 1022 and following — LégisQuébec
- Centris system of Quebec real estate brokers — compiled by the author
- Quebec Land Register, “Statistiques sur le marché immobilier”, updated 17 August 2026 — quebec.ca. Open data under Creative Commons 4.0.
