I’m married. Can I keep my house if we’re separating?

How can you keep the matrimonial home. A snapshot of your options.

I’m married, can I keep my house if we’re separating?

Because you are married, your house is considered a matrimonial home. That is a special asset under the law. Other assets, such as cars, bank accounts and pensions are dealt with differently than the matrimonial home. To answer if you can keep it needs a bit of explaining.

Firstly, a matrimonial home can only be sold or transferred to one spouse if both spouses consent. Meaning, you can keep it if the other spouse approves you doing that. It does not matter if you owned the home before marriage or who is on title. Both spouses have a claim to the equity in the home unless there is a marriage contract.

If the matrimonial home is sold, the money stays in trust with the real estate lawyer until there is either a separation agreement or a court order, even if it was in your name alone beforehand.

A married spouse cannot purchase a new home without having either a signed separation agreement or a court order. This is because a married spouse cannot qualify for a mortgage without one of these documents.  You should not sign a purchase agreement for a new home until you have a signed separation agreement or a court order regarding support to be aware of your ability to buy another place.

Who is on title?

Title means whose name is the house registered in. Look on your tax bill if you have any questions about that. If it’s just you on title, your spouse cannot force you to sell. Only a person on title can force sale. Your spouse does have a claim to half the equity in the home on date of separation.

If both of you are on title to the home, your spouse can force you to sell it. They can only do that by a court order.

You cannot force your spouse to sell his or her interest in the home to you. The court cannot force the spouse to sell their interest in the home to you. The court can only order the house be listed for sale. The court cannot order that you will be the buyer or have a right of first refusal.

If you want to buy the home, your spouse has to agree to it. Unless you and your spouse reach an agreement to buy the other out, the home will have to be sold.

Steps to buy your spouse out of the house

If you want to buy your spouse’s interest in the home, you will need to get an appraisal done. You will need to provide a copy of the appraisal to your spouse. The appraisal is an estimate of the fair market value of the house. The only way to know the actual fair market value is to list the home. The appraisal is the most accurate best-guess on value.

You will also need to know if you qualify for a mortgage and have funds or financing to buy the other spouse’s interest in the house. This question is more complicated than calculating the equity in the home. You also need to know the value of yours and your spouse’s other assets and debts.

Married couples split their growth in property for the period of the marriage. Property is more than just real estate. This means all property, such as bank accounts, pensions, and vehicles. To calculate the value of each spouse’s property, you need to know the value of the spouses’ assets and debts. This is called net family property.

Your net family property has to be compared to your spouse’s to determine who had greater property growth. This can only be determined by giving your spouse documents. These documents are called financial disclosure. Disclosure is a fancy word for information. You need to fully disclose your income, assets and debts to your spouse for date of marriage and date of separation. You cannot just tell your spouse this information. You need to provide documents.

Banks only keep documents for seven years so, if you got married more than 7 years ago, you will not be able to get date of marriage documents from your bank. If you have kept your records, then you are one of the lucky few. Most people throw out their old banking records.

To have a valid separation agreement in Ontario, you need to provide your spouse with your full financial disclosure.

You need to know what you each had at marriage and separation to calculate who had greater property growth. Whoever had greater property growth owes the other spouse a payment. Whether you can afford to buy your spouse out of the home depends on if you owe your spouse a payment for greater property growth.

The only way to determine if you can afford to keep the home is by having both spouse’s full financial disclosure. If you owe your spouse a payment for the greater property growth, then you may not be able to afford to take on the mortgage and buy your spouse’s interest in the matrimonial home.

In short, it is not as straightforward as figuring out if you can afford the mortgage and have funding to buy your spouse’s share of the equity. You should get legal advice from a lawyer to protect your interests and so you understand your rights and responsibilities under the law. Getting that advice does not have to be costly. Remember, our service is based on the time you wish to pay for.