Lawyers who have worked in mortgage foreclosure cases in Nunavut say those who default on their mortgages there face an especially tough challenge finding another place to live when they lose their homes.

In addition to a high cost of living, the territory has long struggled with a chronic housing and rental property shortage, especially in remote communities. Such factors have made mortgage foreclosures particularly difficult for Nunavummiut.

"When you get into some of the communities, there isn't that kind of normal market," said Yellowknife lawyer Ed Gullberg, who has represented banks in mortgage foreclosures in Nunavut since 1987.

"If the house is more than you can afford you may be stuck with it or, more importantly, you may not have anywhere else to go to because quite often the rental market just doesn't have any available housing. So even if you wanted to sell your house, you would have nowhere to go."

While no statistics on foreclosures in Canada or Nunavut are readily available, Gullberg said he believes default rates are higher in the territory than elsewhere.

Paul Nettleton, an Iqaluit lawyer who practices poverty law with Nunavut Legal Services, told CBC News that he's handled about a dozen mortgage foreclosure cases across Nunavut in the past 10 months. He said he's certain there are more cases in the territory.

"It generally involves one or two people — a person and their partner or their spouse — who have managed to borrow considerable funds to purchase a house, and generally they're dependent on both incomes," he said.

"They then may have some setback, perhaps one or both of them lose their jobs, there may be something that happens which means they're off work for some months. Once they fall behind, it's almost impossible to catch up."

For those looking for rental units after losing their homes, Nettleton said it can be a long wait for public housing spots.

Most public housing authorities, Nettleton explained, make defaulters wait two or more years before they can join a waiting list for housing.

"Imagine yourself owning a home, getting in financial difficulty, losing your home and then being ineligible for public housing — and there's nothing available in any event for a number of years," Nettleton said.

In most cases, those who lose their homes end up moving in with friends or relatives, creating overcrowded conditions. Researchers have found that such overcrowding causes stress, depression and violence.

The Nunavut government's staff housing policy includes a program to buy back houses their owners cannot sell when they take a job in another community. However, regular Nunavut residents don't have that option.

Gullberg said he has encountered cases in which people simply abandoned their homes.

Both lawyers said the best way to avoid foreclosure is to be aware of all the costs associated with owning a house before signing the deal.

The Nunavut government has been trying to build more housing to meet a long-existing shortage. A 2005 report prepared for the territorial government and Nunavut Tunngavik Inc. cited Statistics Canada data that showed 54 per cent of aboriginal Nunavut residents living in crowded conditions.

The report said the territory needs to build up to 275 more housing units over the next 10 years to keep up with the growing population.