NOSI Ontario: Plain-Language Guide for Homeowners

What Is a NOSI?

NOSI stands for Notice of Security Interest. As the name suggests, it is simply a notice, registered on your property title at the Ontario Land Registry, that a security interest exists in equipment located at the property.

The security interest itself is created when you sign the rental agreement. By signing, you authorize the company to retain ownership of the equipment and, typically, to register that interest. The NOSI is the public notice of that arrangement; it alerts anyone searching your title that rented equipment is present and that the rental contract runs with the property.

A NOSI is not a lien. It does not give the rental company a financial claim against your property. However, it does appear on your title search, and it can create complications when selling your home or refinancing your mortgage.

Separately, the rental company may also perfect their security interest by filing a PPSA registration (Personal Property Security Act) against your name. The PPSA registration covers the equipment as personal property and typically appears on credit bureau reports approximately six weeks after filing.

How Does a NOSI Get on Your Title?

When you sign a rental agreement for home comfort equipment, the contract typically includes a clause authorizing the company to register a NOSI on your property title. The NOSI authorization is generally found in the terms and conditions of the agreement rather than on the face page.[1]

Door-to-door sales were a major driver of NOSI registrations in Ontario. Salespeople would offer "free" or discounted furnace upgrades as part of rental agreements. Homeowners sometimes discovered the NOSI years later, typically when trying to sell their home or close a refinance.

The registration itself is handled through the Ontario Land Registry system. The rental company (or their legal representative) files the NOSI against the specific property, and it becomes part of the public title record.

Ontario's 2024 Ban on New NOSIs

In 2024, the Ontario government passed the Homeowner Protection Act (Bill 200), which banned the registration of new NOSIs for home comfort equipment.[3] This was a major win for consumer protection after years of complaints from homeowners across the province.

Here is what the ban does and does not do:

• New NOSIs cannot be registered for home comfort equipment (furnaces, air conditioners, water heaters, water treatment systems, and similar equipment).
• All existing consumer goods NOSIs were deemed expired retroactively as of June 6, 2024. The ban IS retroactive for consumer goods. The underlying rental contracts remain enforceable through other legal means.
• PPSA registrations are not affected by the NOSI ban. Companies can still file PPSA registrations against the personal property (the equipment itself).[6]

If you already have a NOSI on your property, the 2024 ban does not automatically remove it. You still need to go through the discharge process, which we cover below.

How to Check if You Have a NOSI

The most reliable way to check is through Ontario's OnLand portal (onland.ca), which provides access to the province's land registry records.[2]

1. Go to onland.ca and create an account (free to register).
2. Purchase a parcel register for your property. This costs approximately $35.
3. Review the document list. A NOSI will appear as a registered instrument with a description like "Notice of Security Interest" or similar wording.
4. Note the registration number and the company name listed. You will need both when requesting a discharge.

Alternatively, your real estate lawyer can run this search for you as part of a standard title search. If you are in the process of selling your home, your lawyer will likely flag any NOSIs during the transaction.

How a NOSI Affects Your Home Sale

A NOSI does not prevent you from selling your home, but it can create significant headaches during the process. Here is what typically happens:

• Buyer's lawyer flags the NOSI during the title search. Most buyers expect a clean title at closing.
• The buyer may demand removal as a condition of closing. This means you need to pay out the rental contract before the sale completes.
• Buyout costs can be substantial. HVAC rental buyouts in Ontario commonly range from $3,000 to $15,000 or more, depending on the equipment, the contract terms, and how much time remains on the agreement.
• Delays are common. Getting a NOSI discharged can take weeks, which can push back your closing date or jeopardize the sale entirely.

Some sellers choose to negotiate the buyout cost into the sale price, effectively splitting the cost with the buyer. Others pay the full buyout from the sale proceeds. Either way, discovering a NOSI late in the sales process creates unnecessary stress and expense.

How to Remove a NOSI from Your Property Title

Removing a NOSI requires the company that registered it to file a discharge with the Ontario Land Registry. Here is the typical process:

1. Contact the rental company and request a buyout quote. Ask for the exact amount required to buy out the contract and have the NOSI discharged.
2. Review the buyout amount carefully. Compare it to the remaining payments on your contract. In some cases, the buyout amount is simply the total of remaining monthly payments. In others, companies may charge additional fees.
3. Pay the buyout and get written confirmation that the company will discharge the NOSI. Ask for a specific timeline.
4. Follow up on the discharge. After payment, confirm through OnLand that the NOSI has actually been removed from your title. This can take several weeks.
5. If the company refuses or stalls, file a complaint with the Ministry of Public and Business Service Delivery. Under the Consumer Protection Act, 2002, the company is obligated to discharge the NOSI once the contract obligations are fulfilled.[4]

NOSI vs. PPSA Registration: Key Differences

These two terms come up frequently in HVAC rental situations, and they serve different purposes.[6]

An HVAC rental company may have both a NOSI and a PPSA registration on the same equipment. When buying out a contract, ask the company to confirm that both registrations will be discharged.

What to Do if You Discover a NOSI You Did Not Agree To

Some homeowners discover NOSIs on their title that they never knowingly authorized. This is more common than you might expect, particularly with door-to-door sales contracts. If this happens:

1. Request a copy of the signed contract from the rental company. Under the Consumer Protection Act, 2002, they are required to provide this.[4]
2. Review the contract for a NOSI authorization clause. If no such clause exists, or if the contract was not properly executed, you may have grounds to demand removal without a buyout.
3. Check if the cooling-off period was respected. For door-to-door sales in Ontario, you have a 10-day cooling-off period to cancel the contract without penalty.[4]
4. File a complaint with the Ministry of Public and Business Service Delivery if the company is uncooperative.
5. Consult a real estate lawyer if the NOSI is blocking a home sale or refinance. A lawyer can sometimes get a court order to remove an improperly registered NOSI.

Protecting Yourself Going Forward

With the 2024 ban in place, new HVAC rental agreements cannot include NOSIs.[3] However, you should still be aware of a few things:

• PPSA registrations are still possible. Even without a NOSI, a rental company can register against the equipment itself through the PPSA system.
• Read every contract carefully before signing, especially for rented or financed HVAC equipment.
• Consider buying outright or financing through your bank. Purchasing your HVAC equipment avoids both NOSIs and PPSA registrations entirely. The long-term cost of ownership is almost always lower than renting.
• Get a title search before buying a home. If you are purchasing a property, ensure your lawyer checks for existing NOSIs so you can negotiate their removal before closing.

Frequently Asked Questions