The Past and Present of the Notice of Security Interest (NOSI)

Notice of Security Interest (NOSI) is a legal instrument frequently used by small leasing equipment companies in Ontario to secure the debts. It can be directly registered against a consumer’s real property, requiring the debt to be settled or the lease to be assumed by the buyer before the property can be sold. However, NOSI has been misused by some unscrupulous individuals or companies as a powerful tool to defraud consumers. Many senior homeowners have been told they qualify for certain free government benefits for home renovations or equipment upgrades, or that they can lease small equipment at low cost. They then sign contracts for home renovations or the installation of small equipment, only to later discover that multiple NOSIs have been registered against their property. These large debts must be paid off before they can sell their home. Unable to afford legal representation, many homeowners have lost their homes to power of sale by unethical financial companies.

Thanks to the relentless efforts of a lawyer and various community sectors, the Ontario government officially implemented the Home Owner Protection Act on June 6, 2024. This act announces that NOSIs related to consumer goods can no longer be registered against properties, and all previous such registrations are now deemed expired, meaning they are void. This means leasing equipment or financial companies can no longer use homeowners’ properties to demand repayment but must exercise their claims through other legal venue. If consumers dispute the debt, they no longer need to fear losing their home. To discharge a NOSI related to consumer goods on a property, homeowners can hire a lawyer without needing the creditor’s consent with only a small cost.

It is important to note that the cancellation of NOSIs does not mean the disappearance of the debt. Legitimate leasing or loan contracts must still be fulfilled. Additionally, this legislation only removes NOSIs related to consumer products, specifically goods used primarily for personal, family, or household purposes. Non-consumer goods related NOSIs can still be registered on the title of your home.

Disclaimer:

1. This article is for reference only and does not constitute any legal advice. For specific issues, please consult your lawyer.

2. This article is copyrighted by Zeng Law Professional Corporation. Unauthorized copying, reprinting, excerpting, or reproduction by any other means is prohibited.