NOSIs, liens and HVAC contracts in Ontario
If you have heard horror stories about a water heater contract turning into a lien on someone’s house, you are thinking of a NOSI. Ontario banned them on consumer goods in 2024. Here is what that means, and what to check before you sign anything.
What a NOSI was
A Notice of Security Interest, or NOSI, was a notice a company could register on the title to your home saying it had an interest in equipment inside it: a water heater, a furnace, a water softener. It was never a mortgage and it did not transfer ownership of anything. But it sat on your title, and it surfaced at the worst possible moment, when you were selling or refinancing and a lawyer ran a title search.
Why they became a scandal
The registration itself was cheap and easy, and for a long time nobody had to tell you clearly that it was happening. Homeowners found NOSIs they did not remember agreeing to, sometimes several, sometimes for equipment they no longer had. Because they showed up during a closing, people paid inflated amounts to clear them under time pressure rather than lose a sale. Door-to-door sales in the home-comfort industry was where the worst of it happened.
Ontario banned them in 2024
Ontario passed the Homeowner Protection Act in 2024. It prohibits registering a NOSI against consumer goods on the title to a home, and it dealt with the ones already on title. The practice that caused the damage is over. If you are reading an older article that says to watch out for NOSIs on a new HVAC contract, it predates the change.
A PPSA security interest is a different thing
When you finance equipment, the company that lent you the money usually takes a security interest in the equipment and registers it under the Personal Property Security Act. That is ordinary and it is how financed goods work, from a car to a furnace. The registration is made against you as a person and describes the equipment; it is not filed against the title to your home. It is not a NOSI and it does not appear as a lien on your property.
What Arctic does
On the financed option, Arctic registers its security interest in the equipment under the PPSA, against you as a person using your name and date of birth, never as a lien on the title to your home, and discharges it once the balance is paid. On a monthly plan, Arctic owns the equipment during the term, may register its interest the same way (against you, never against your title), and the equipment becomes yours at year 15. If you sell before then, the plan can transfer to the new owners. You can also end it early at the buy-out price fixed in your agreement the day you signed.
What to check before you sign, with anyone
Ask three questions of any home-comfort company, including this one. Does anything get registered against my home’s title? What exactly is registered, and against what? What does it cost and how long does it take to remove when I pay it off or sell? A company that cannot answer those plainly, in writing, is telling you something. Get the answers in the agreement rather than in conversation.
If you already have a NOSI on your title
If you bought a home with an older registration on title, or you think one was registered without your informed agreement, speak to your real estate lawyer. They can tell you what is actually registered and what the current law means for it. Arctic cannot give you legal advice about an agreement you signed with somebody else, and anyone who offers to is not helping you.