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Rising housing prices made for great stories about sharing ownership with friends and family, but as prices have collapsed, in some cases wiping out the equity entirely, fingers are being pointed.

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The pointing is coming from lenders and it’s aimed at anyone on the title and named on the mortgage who has assets — or a job — in Canada.

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“The banks will go after whoever they will get money from,” said Douglas Hoyes, a licensed insolvency trustee and co-founder of Hoyes, Michalos & Associates Inc.

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A recent case is a good example, he said. Three brothers and their father bought a property near the top of the housing market in 2021.

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With the average home in Canada down 16 per cent since the February 2022 peak, according to the Canadian Real Estate Association, their property is now $175,000 underwater and has been put into a power of sale, which allows lenders to sell the home when a mortgage is in arrears.

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One son lost his job in 2024 and moved back home abroad. Another, who orchestrated the deal, has moved to the United States. The father is retired and living in Mexico on his Canada Pension Plan and Old Age Security payments.

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But the third son, still in Toronto, who had only contributed financially to the investment, is now facing a bank that will pursue him aggressively for the loss because he is the only one in the country with assets and a job.

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“I can tell you 50 stories that are virtually identical to this one,” said Hoyes. “The key factor in all of these is buying near the peak with minimal down payment.”

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Mortgage default insurance is not going to protect you, if you have it. The insurance, often through Canada Mortgage and Housing Corp., is required if you have less than a 20 per cent down payment and are borrowing from a regulated financial institution, but is designed to protect the bank. The CMHC will still come after you to recoup its loss, sometimes years later.

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“I remember a case where it took 10 years for CMHC to go after the guy,” said Hoyes.

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Noam Dolgin, a British Columbia realtor who co-founded Collaborative Home Ownership BC, said deals are still happening and buyers can include provisions in a transaction that can partially address a fall in real estate prices.

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“The vast majority of our deals are mimicking strata life (also known as a condo corporation),” said Dolgin, “You get your own suite, you get your own property but it’s not separately titled.”

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Your deal may look structured like a condo but it’s not legally the same thing and you are liable for everyone else’s debt on the property.

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In some cases, his company has brought strangers together, but mostly Dolgin’s group will combine family or friends. The math can work, he said.

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“We look for properties that might be 30 per cent to 40 per cent cheaper,” he said, adding that half duplexes can start at $1.4 million in Vancouver but a house with the same square footage and two suites an be bought for $2 million.