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Judicial sale is a court-supervised method of selling a mortgaged property after default, used in British Columbia, Alberta, and several other provinces, in which a court approves the listing, the accepted offer, and the final sale before it can close.
In BC and Alberta, foreclosure runs through the courts from the start: the lender files a petition setting out the debt owed, the court issues an order establishing the amount needed to redeem the property and a redemption period (commonly around six months in BC), and if the borrower doesn't pay out during that window, the court can order a judicial sale or grant the lender the property outright through an order absolute. Every step, including the accepted price, terms, and commission, needs court approval before a judicial sale can close.
This differs from power of sale jurisdictions like Ontario, where a lender can sell a defaulted property under statutory authority without a court approving each step, subject to required notice periods. Judicial sale provinces generally take longer to resolve a default, and whether the lender can pursue the borrower for a shortfall after a judicial sale depends on the province and whether the mortgage is a recourse mortgage.
Court-driven process: British Columbia, Alberta, Manitoba, Nova Scotia, and Saskatchewan primarily use a judicial sale or judicial foreclosure process rather than a lender-driven power of sale.
Court approves every step: in BC, the Supreme Court must approve the listing terms, the accepted offer, and the final sale before a judicial sale can close.
A redemption period applies: before a judicial sale proceeds, the borrower typically gets a court-ordered redemption period to pay out the debt in full and keep the property.
Ties into recourse: link recourse mortgage — whether the lender can pursue the borrower for a deficiency after a judicial sale depends on the province and the type of mortgage involved.
Definitions reflect Canadian federal and provincial rules as of the “Updated” date above. Not advice for any specific file.
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