416-364-9366 bob@aaron.ca

Elderly homeowners fall victim to predators hawking services, equipment

Jan 6, 2024 | 2024 Toronto Star Property Law Columns

By Bob Aaron
Toronto Star contributing columnist

Homeowners don’t know notice of security interest is registered on their title. In selling their home, they have to pay it out.

A group of Ontario real estate and litigation lawyers has written an open letter to Todd McCarthy, Ontario’s minister of Public and Business Service Delivery, calling for the prohibition and retroactive removal of notices of security interest (NOSI) on the title to Ontario residential properties.

A NOSI is a notice that can be registered in the land titles system by a business when it finances or leases equipment such as a heating, ventilation and air conditioner (HVAC) unit.

Greg Weedon, who is spearheading the effort by Ontario lawyers, explains the problem this way: “The registration of notices of security interest (NOSIs) … against title ownership of vulnerable homeowners in Ontario, often in respect of unwanted and overpriced home services and equipment, has escalated to the point where it is openly and brazenly being abused. The victims of these predatory practices are elderly homeowners who are socially isolated with limited financial means, deliberately targeted due to their social and demographic profile.”

The petition follows on the heels of the government’s now-concluded six-week consultation which sought public input on ways to address and reduce the harmful and inappropriate use of NOSIs against unsuspecting consumers.

Homeowners are typically not aware that a NOSI has been registered on their title. In the process of selling or refinancing their homes, thousands of owners have discovered at the last minute that they have to pay out and discharge NOSI registrations to provide clear title.

Often, the sellers of the equipment or their finance companies charge exorbitant fees and interest to give clear title.

In an October announcement, the Ontario government said it is considering ways to clarify rules and obligations for businesses to discharge a NOSI, while providing enhanced powers to Consumer Protection Ontario to help homeowners when a business fails to do so.

More bureaucracy is not the answer to the NOSI problem. Five years ago, the Ontario government restricted the door-to-door sale of many products but most predatory sellers remain undeterred.

Weedon’s pitch to the Ontario government tells Minister McCarthy that there is no adequate solution other than a complete prohibition of NOSIs for all registered ownership. He says, “there is simply no place for the NOSI in the property registration system. The NOSI is being used as a mini-mortgage, without scrutiny, and has become much more than a mere nuisance – it has become a vehicle for fraud.”

Thousands of homeowners who have purchased HVAC equipment may not be aware that their property titles have had NOSIs registered against them. “The only viable solution to protect Ontario homeowners,” Weedon says, “is to remove, via legislation, the ability to unilaterally encumber and leverage title through the use of the NOSI.”

As well, he suggests that all existing registered NOSIs be deleted. “It is time to right those wrongs,” he addded.

“The current rules do not adequately protect homeowners from harmful and inappropriate business practices,” said Minister McCarthy. “We are committed to finding solutions to this important issue that would keep consumers from losing money to unscrupulous actors…”

Ontario consumers can only hope the government will stand behind its commitment.


Contact Bob Aaron

Bob Aaron is a Toronto real estate lawyer and frequent speaker to groups of home buyers and real estate agents.
He can be reached by email at bob@aaron.ca, phone 416-364-9366 or fax 416-364-3818.

Aaron & Aaron specialize in Real Estate Law, specifically Sale of Rental, Condominium, Residential, Rural Recreation, Offer to Lease, Commercial, and New Construction

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