On January 23rd, we were served with a statement of claim on our house. We tried and tried to make payment arrangements with the bank, they wouldn't return our calls. So, we decided to put the house up for sale, before the bank does. We would like to know, if we file a defence, would we be given extra time because we listed the house? That would enable us to sell, pay off the mortgages, and MAYBE have enough left for a piece of vacant land (well a down payment anyways) We live in Lanark, Ontario and we are not sure how this works.

Sounds like you need to figure out whether you are in a 'judicial' foreclosure state, or 'notice' foreclosure. Read the statement of claim carefully; did you also receive a summons? Are you to file an answer within so many days? In my jurisdiction, all the creditor must do is run an advertisement for four consecutive weeks in the legal newspaper, then sell at auction the property on the next Tuesday; it's done and overwith, unless you get a stay of some type.

Time frame will vary by bank but in today's real estate market and your needs. You may sell it for enough to do all of that, but then you may get it sold a lot faster for just what you owe. Also at least here in the states things are so slow selling people have to sell them for less than they owe very often.

Have you had it appraised according to what houses are selling currently

Check out lend america.com they have many programs for people in your situation. Never give up there are many options. Good luck

Who is your lender? Did you ask them if you can refinance into a hope 4 homeowners loan?