Regardless of the circumstances, separating from a spouse can be a challenging time. One of the first decisions you will need to make with your partner, is what to do with the family home. This article will cover the different aspects you will need to consider to make the transition as smooth and peaceful as situation allows.

When emotions are running high, you do not want to make a rushed decision about your family home. It is best to slow things down, as a hasty decision is not always the best long-term choice for your family.

Let’s review matrimonial home rights in Ontario, as the legal definition of the home impacts your share with your spouse, and will determine what decisions will follow.

Matrimonial Home Rights

Under section 18(1) of the Family Law Act, “Every property in which a person has an interest and that is or, if the spouses have separated, was at the time of separation ordinarily occupied by the person and his or her spouse as their family residence is their matrimonial home” R.5.0. 1990, c.F.3,s.18(1).

This means that if you were living in the home at the time of separation, and have a vested interest in it, that property is considered the matrimonial home regardless of who technically owns it. This definition includes rental and lease homes. If your partner has a lease agreement in their name but you reside there with them, it is still considered the matrimonial home.

This definition also includes other homes, like summer cottages, for instance.

Buyout or Sell The Home?

The most common options people choose are:

1. One partner stays and buys out their former partner who moves into a new home.
2. Both partners move and sell the home.

When choosing the right strategy for your family, it’s important to consider the costs associated with the sale:

• Real estate agent
• Lawyer
• Land transfer tax (if applicable)
• Closing costs
• Current mortgage penalties

Whether you choose to buyout or sell, the Chell Team can help to establish the market value of your home, which then can be used to determine the appropriate compensation for a buyout scenario or listing the home. We provide the professional guidance and support you may need for this to go smoothly.

If you and your ex-partner can come to a separation agreement, this will simplify your divorce proceedings in the future. Your separation agreement will determine your living arrangements and the division of property and other assets.

Buyout Considerations

If one partner buys the other out, the person moving has a few considerations to keep in mind. Many people choose to find a temporary living arrangement until emotions settle and they can make a clear-headed decision on their future home.

Both partners need to carefully analyze their finances to determine if buying or renting is more appropriate. If you have children, that will add another layer of complexity.

When Children Are Involved

If children are involved, the proximity to the other parent is important. Having a child-friendly home within a reasonable distance from the other parent will be crucial during custody negotiations.

Selling Considerations

At the Chell Team, we provide a collaborative, client-first approach and high standard of service to help guide you through this process. Particularly when selling due to a separation, your emotions can interfere with you making the best selling decision. We can help you get the most out of the sale and tactfully help you find the best new home for your family circumstances.

Make a Financial Plan

Naturally, evaluating your new financial circumstances is an essential part of your family home decision. Together with your financial advisor, create a new budget and determine if RRSPs will be available to you.

Finalizing Your Separation Agreement

Finalizing your separation agreement can be straightforward or complex depending on your assets, custody agreement, and to what extent you and your former partner agree on asset division.

There are a number of professionals available to assist you, including mediators, lawyers, accountants and family therapists.

While the fees for these professionals can be steep, it is often well worth the investment to reach an agreement as peacefully as possible.

Conclusion

Separating is never easy, and deciding what do to do with your family home can be an added challenge. The Chell Team, can provide guidance and support through the process.