Maintaining Your Mortgaged Property: Borrower Obligations

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When a borrower takes out a mortgage in Quebec, they commit not only to making payments but also to maintaining the property in good condition. This property maintenance obligation stems directly from the Civil Code of Quebec (CCQ), which protects the mortgage creditor's right to the value of the property given as security. In practical terms, the borrower must maintain the building in a reasonable state, carry out necessary repairs to preserve its value, and avoid any action that could diminish the value of the security. The CCQ prohibits the borrower from committing voluntary degradation or allowing the property to deteriorate to the point of compromising the lender's security. This obligation covers general building maintenance, including the roof, plumbing, heating, structure, and mechanical systems. Additionally, the borrower must maintain adequate home insurance on the property, as loss or destruction of the property without insurance would deprive the lender of their security. In cases of non-compliance, the lender has recourse under the CCQ, which can extend to demanding early repayment of the loan if the decrease in value is significant. AMF-certified mortgage brokers in Quebec regularly remind their clients of these obligations to protect both parties.

Maintaining Your Mortgaged Property: A Fundamental Obligation

A mortgage extends far beyond the monthly payment. When signing the mortgage deed before a notary in Quebec, the borrower commits to preserving the value of the property that serves as security for the loan. This maintenance obligation is enshrined in the Civil Code of Quebec (CCQ) and constitutes one of the pillars of Quebec mortgage law. The lender, in granting substantial financing, relies on the property's value to secure its claim. Any significant decrease in that value compromises the security and can trigger legal recourse.

What the Maintenance Obligation Covers

Structural maintenance: foundation, framing, roof, exterior cladding, and insulation. The borrower must prevent water infiltration and structural damage.
Mechanical systems: plumbing, heating, ventilation, air conditioning, and electrical systems. These must be functional and compliant with current standards.
Loss prevention: measures against frozen pipes in winter, French drain maintenance, roof snow removal if necessary, and pest prevention.
Home insurance: maintaining a policy covering at minimum the replacement value, with the lender as the priority beneficiary in case of a claim.
Municipal compliance: adherence to zoning regulations, occupancy standards, and certificate of location requirements.

Prohibition Against Devaluing the Property

The CCQ explicitly prohibits the borrower from taking actions that diminish the value of the security. This includes unauthorized partial demolition, removal of fixed equipment (such as a heating system), voluntary degradation, or changing the building's intended use without the lender's consent. Even prolonged neglect, such as failing to heat a building during a Quebec winter, can constitute a breach of this obligation if it results in frost damage.

Lender Recourse in Cases of Non-Compliance

When a borrower fails to meet their maintenance obligation, the lender has several remedies under the CCQ. The lender may first require the borrower to carry out necessary repairs within a reasonable timeframe. If the breach persists and the security's value is seriously compromised, the lender may invoke acceleration of the term and demand immédiate repayment of the mortgage balance. In the most serious cases, the lender may exercise its hypothecary rights, including taking in payment or sale under judicial authority. AMF-certified mortgage brokers in Quebec strongly recommend that clients document their regular maintenance and keep repair invoices as proof of compliance.

Frequently Asked Questions

What are the maintenance obligations for a mortgaged property in Quebec?

The borrower must maintain the property in good condition, carry out necessary repairs to preserve its value, and avoid any action that could diminish the security's value. This includes maintaining the roof, plumbing, heating, structure, and mechanical systems. The CCQ imposes this obligation to protect the mortgage creditor's rights.

What happens if I let my mortgaged property deteriorate?

If the property deteriorates to the point of compromising the lender's security, the lender may demand corrective measures. In severe cases, the lender can invoke an acceleration clause and demand early repayment of the loan. The CCQ protects the lender against voluntary or negligent reduction in property value.

Is home insurance mandatory on a mortgaged property?

Yes. All mortgage lenders in Canada require adequate home insurance as a loan condition. The insurance must cover at minimum the building's replacement value. The lender is generally designated as the priority beneficiary of the policy in case of a claim. If you cancel your insurance, the lender may purchase coverage at your expense.

Can I do major renovations on my mortgaged property?

Yes, renovations that increase the property's value are generally permitted and encouraged. However, major structural modifications or changes to the building's intended use may require lender approval, especially if they affect insurance coverage or municipal zoning.

Can the lender inspect my mortgaged property?

The mortgage agreement generally includes an inspection right for the lender. In practice, lenders only exercise this right if they have reason to believe the property is at risk of significant détérioration, for example in cases of prolonged non-payment or reported damage.