Which lending option you can still get depends almost entirely on how far the foreclosure has progressed. A HELOC or home equity loan normally disappears once you are in arrears. B lenders and private lenders look at equity rather than perfect credit and stay available longer. A reverse mortgage generally needs the mortgage to be in good standing. The earlier you ask, the more of the list is open.
Every kind of lender people ask us about, and when each one actually works
People arrive here searching for a specific product — a HELOC, a home equity loan, a B lender, a reverse mortgage — and the honest answer is that which product you can get depends almost entirely on how far along the foreclosure is. Here is the straight version of each, including the ones that usually will not work once you are behind.
Private lender mortgage
A private lender mortgage is equity-led rather than credit-led, which is why it stays available further into a foreclosure than anything else on this list. It is also the most expensive money here. Used to bridge to a firm sale or a recovered income it does real work; used to postpone the same problem it quietly eats the equity you were protecting. Ask for the rate, the fees, the term and specifically what happens on the day the term ends, all in writing.
HELOC or home equity loan
A home equity line of credit is the cheapest money on this list, and it is also the first thing to disappear. Lenders check your standing before advancing, and arrears or a registered Statement of Claim will normally end the conversation. If you already have a HELOC in place and it has not been frozen, it is worth checking your available room today rather than next month. If you do not have one yet and you are already behind, this is usually not the route.
B lender mortgage and alternative lender mortgage
A B lender — also called an alternative lender — sits between a bank and a private lender. They price on the property and the overall picture rather than needing a perfect credit file, and they are regulated, which matters. Rates are higher than a bank and lower than private money. For someone with real equity and income that is recovering, this is often the most sensible middle option, and it is the one most people have never heard of.
Bridge loan
A bridge loan is short-term money covering a gap with a defined end — most often a sale that is firm but has not closed. The word "bridge" is doing real work there. If there is nothing on the far side, it is not a bridge, it is an expensive delay.
Reverse mortgage
In Canada a reverse mortgage is available from age 55, and it pays out equity with no monthly payments, which is why it comes up in exactly this situation. Two things to know: it is normally only available on a property in good standing, so an active foreclosure usually rules it out, and the balance grows over time rather than shrinking. For an older owner with substantial equity who acts early, it is a genuine option. For someone already served, it is usually too late.
Credit unions
Alberta credit unions are worth a call and are routinely skipped. They lend on their own criteria rather than a national bank's, and a local branch will sometimes look at a file a bank has already declined.
The pattern across all of them: the earlier you ask, the more of this list is open to you. Every step of the foreclosure closes a few more doors, which is the single strongest argument for finding out where you stand now rather than waiting to see what happens.
We are not lenders, we are not mortgage brokers, and we are not paid to send you to any of them. This is a description of what exists, not a recommendation of what you should take.