MONTREAL -- A Verdun man in his 70s says he’s learning in the hardest way that Canadian banks’ mortgage flexibility doesn’t always extend very far.
Ahmad Abadi bought a building in Verdun five years ago to help ensure some financial security in his later years. He lives in one unit, rents out the others, and drove an Uber to make ends meet.
He has a heart condition, however, and when the pandemic arrived he gave up cab driving, worried about the health risks.
"I also have some mild asthma,” Abadi says. “I was very vulnerable... so I stopped.”
He asked to defer his mortage payments for three months and his bank granted the request. The deferral ended in June.
But his own income hasn’t returned, and as his tenants have also lost their own income, the financial situation has only worsened.
He believes that by fall, things will likely stabilize somewhat. “I think in two to three months it could be okay,” he said.
But when he applied for a second deferral, he was refused, leaving him panicking.
“I’m really suffering from anxiety—I can't do anything,” he said. “I cannot work... I am having a hard time.”
The Consumers’ Council of Canada says the pandemic has exposed the cracks in the country’s lending system. It’s not built to withstand big-picture emergencies that halt income.
For their own good, “financial and other businesses are going to need to begin adjusting to reality,” Ken Whitehurst of the Consumers Council told CTV News.
“Otherwise they’re not going to just miss a payment,” he said. “The consequences for them are going to be considerably greater.”
Laurentian Bank wouldn’t comment on Abadi’s case, but they told CTV News that the six-month deferrals they had announced were not guaranteed.
“Payment deferrals are not automatically approved -- even in the context of the COVID 19 crisis,” the bank said.
“We evaluate mortgage payment deferrals requests on a case-by-case basis.”
As of June 24, over 700,000 Canadians had deferred their mortgages, 19 per cent of which are Laurentian Bank customers.
Abadi says he believed the bank when they said they were ready to help, but in retrospect the message rings hollow.
“The help that they were promising is not coming,” he said.