Anthony and Cheryl Britch plead with bank for their house
Bank reviewing foreclosure after CBC makes inquiries
Anthony and Cheryl Britch say TD Bank is foreclosing on their home after a health crisis and a disgraced debt consolidator left them broke and unable to pay the skyrocketing, high ratio mortgage payments on a $253,000 debt.
"We were misled. I feel we were tricked." said Cheryl Britch, 48.
Britch says in 2008, TD Bank convinced them to sign up for a new product called a `High Ratio Home Equity Line of Credit` that would consolidate their debt and require interest-only payments for five years.
The Britches would then pay off the principal, plus interest over the following 20 years.
The mortgage specialist "was very gung-ho, thought this would be the perfect answer to our prayers" said Britch whose husband suffers from Ankylosing Spondylitis, and has had two heart attacks.
Britch claims she asked the TD specialist how much the payments would be after the 5 year interest only period expired.
"She said it would probably be a few hundred dollars [more] , and I said oh, okay" said Britch who claims the contract wasn't clearly explained.
Two years later her husband was diagnosed with a painful form of arthritis called transverse myelitis.
"He is basically numb and tingly all over 24 hours a day. It's very painful" she said, explaining she had to quit her job at Walmart to care for him, and max out their line of credit.
Payments more than double
Anthony Britch says after five years, they were shocked when their payments more than doubled.
"After the interest-only period stopped they suddenly start reducing the credit limit and because we hadn't reduced the amount we owed because of the issues with my health, it just keeps growing and growing" said Britch whose payments ballooned from $850 to $1,900 a month.
Realizing they were in financial trouble, the couple went to a debt consolidation firm in 2012.
Options Credit Canada promised to renegotiate with their other creditors and pay each one monthly.
But a year later the Britches were horrified to discover their creditors were never paid a dime. They say they lost a total of $12,000, were forced into bankruptcy and are one of dozens of people claiming their credit was ruined by Don Antle, who is now facing several lawsuits.
Antle has not responded to CBC's request for an interview. Consumer Protection BC revoked his license for failing to comply with industry regulations.
Product no longer offered
The Britches then asked TD to turn their line of credit into a conventional mortgage, but they didn't qualify. The bank began to foreclose on the townhouse, assessed at $208,000 according to property tax records.
"I'm disappointed in the bank"` said Anthony Britch who works full time as a systems analyst. His wife is a part time educational assistant. "We're the little guy and we need help. And this problem I strongly believe was their fault."
They told us it was actually a bad product ... and they don't offer it anymore," said Cheryl Britch. "And I said, okay so what do we do?" They wouldn't budge."
Bank reviews foreclosure after CBC inquiry
But TD Bank did agree to review their case after CBC News made inquiries,
TD also confirmed they stopped offering the product shortly after the Britch's signed their mortgage.
"We stopped offering the high ratio home equity line of credit in order to comply with revised government regulations," said Jeff Meerman, manager, corporate and public affairs for TD Bank in a statement.
"We sympathize with the hardships faced by these customers and we're currently exploring ways in which we can assist with their situation."
The Britches say a TD representative has contacted them since CBC made inquiries about the foreclosure.
Cheryl Britch fears her 13 year old son who has autism would be traumatised by a move.
"This is the only home he's known since he was 3 weeks old...This is where we want to stay."
Britch was relieved when several hours after TD issued a statement, the bank called to say it had found a solution they believe will avert foreclosure.
"I'm so happy and grateful we contacted CBC because if we get to keep our home we won't have to disrupt our kids" she said.
Expert warns against 'interest only' mortgages
"This particular product or any product for that matter that results in payment shock, a scenario where your payment doubles, is not a good product," said expert mortgage broker Bruce Joseph of Anthem Mortgage Group in Ontario.
Joseph warns his clients against interest-only payments and says unconventional mortgages are risky because it's easier for banks to foreclose.
He says mortgage specialists at the big banks are sales people.
"There's a misconception with the Canadian public that front line sales reps are advisors with a fiduciary duty to have the borrower's best interest in mind and that is simply not the case."
CBC News Investigates
With files from Paisley Woodward