Friday, 22 March 2019


WHAT TO DO WHEN SPOUSES BUY A HOUSE
                                                           
Here is a scenario to consider

You and your partner are unmarried and you have bought a house together.. You later break up. You feel that you should get half of the value of the house when the house is sold and you want at least half of the furniture etc,, you both bought.

Now, this isn’t too much of a worry if you both have agreed to terms that you have set down for yourselves.

“I have had two clients who were certain they found their soulmates, only to realize they had not and both bought a house and its furniture together.  Do they now have a huge problem and financial albatross stound their necks?

I have  a friend in Canada in which my friend bough the house he and his wife live in and his wife paid nothing towards the purchase or anything towards the mortgage  payments. Now they are separated. He lives with his mother and she lives in the house he bought for him and his wife. They have no children between them

Can he sell the house? Yes he can. But can he claim all the money from the sale of the house?  No he cannot in Canada. Because he is married, he will only get half the value of the house and she will get the other half.

In Canada, when common-law spouses separate, they can deal with all the issues of their separation by entering into a formal separation agreement. This agreement can set out how their property will be divided.  I strongly suggest that before those who are in a common-law relationship wish to buy a house, they should draw up an agreement as to what each person will be contributing towards the purchase of the  house and how much they are each  going to contribute towards the mortgage, heating, water, electricity and taxes. 

If they decided to separate and they also intend to sell the house,  then they can calculate what percentage each paid towards the purchase of the home, the mortgage payments and the property taxes when splitting the money from the sale of the house. 

If the man paid everything towards the purchase and mortgage and taxes because his spouse was staying home to raise their children, the spilt should be 50/50.To make this valid, it should be in writing and witnessed.

If one of them decided that he or she wishes to remain in the house, then that person should pay the other spouse fifty percent of the current value of the house.

Talking about what to do with co-owned property in the event of the breakup is a “complicated issue to deal with. It’s never easy to contemplate the end of a relationship, and it becomes even harder when you throw money into the equation. But being civil and fair when you’re happy with each other is so much easier than when you’re dealing with a breakup. That is why you should both meet with a lawyer that you both agree is your best choice. You should also agree on the real estate agent who will evaluate the monetary value of the property.

This is easier said than done, but you need to remember that while you may love the other person, it’s also important to take your own legal well-being into account.

“Be explicit that there is a future-focus rather than spending time pointing fingers and blaming.  “It’s totally necessary, but I think what I have suggested can be an advantage to you both in this difficult situation you are both in.

Before you both decided to purchase a home, consider the following questions.

Do you want a rose garden? How about a large yard for the dog you hope to one day adopt? How about an hour to be alone in the home every weekend? Whatever it may be, it’s important that you’re honest with your terms and core needs. It’s equally important that you’re buying a home with a partner who respects our stated boundaries.

If you have a partner that stonewalls your needs then that should be a warning sign to you to seek advice from a lawyer of your own choice if visits to a marriage counsellor fails to resolve your propblems with your partner.   

The process of flexibility as a couple can help you to see how you will handle future adversity as it arises.  For example. it is not enough to just talk about your prospective living together in a home you may want to purchase together. You should also talk about what you can agree on if you both decided to separate.

Before you both purchase a home. I recommend that you both  draw up a “proverbial Prenuptial Agreement” that details what will happen during every step of the home-buying and homeownership process, as well as what will happen if you break up or tragedy befalls one of you.

You’ll need a complete picture of each other’s finances as well as a written contract. It’s best to do this under a trusted lawyer’s supervision. That way, you’ll know all your i’s are dotted and your t’s are crossed.

After your contract is written and signed under your lawyer’s supervision, the safest legal approach is to record it at your county recorder’s office along with the deed of your home.

What should happen if you decide to buy a home without a legal agreement, and then you are separated? The general blanket decision is that, if you chose to take it to court, the court will order the property to be sold and the proceeds to be divided—given you have the documentation to prove your partial ownership and investment in the home. Even if you don’t have documentation, it would be worth it to speak to a family lawyer and see what your options are in your state or province that you live in.

Whatever path you and your partner may take before purchasing a home together, just remember that it’s wiser to go into home ownership with eyes wide open rather than being blinded by love.

When I bought our first house for my wife, my family and myself, I put the down payment on the purchase and paid all the mortgage payments. When we moved, the money we got from the sale of the house was applied towards the second house we moved into. I also paid the mortgage payments every month.

The new house was in my name only. Since I was practicing law I was obviously well aware that if we split up, my wife would get 50% of the proceeds from the sale of our new house because in the province of Ontario, the law as per the Ontario’s family law makes it mandatory that the proceeds of the sale are evenly split because we were and still are, a married couple. .Later, I chose to have t our home placed in her name only since my work as an author, puts me at risk at being sued. If a judgment was filed against me, the plaintiff who sues me can’t touch our house.   

I have a friend who is married to a woman whom he doesn’t love anymore since they always argue. They live in the house he purchased with his own money and he pays the mortgage. She contributed nothing toward the cost of the purchase and the mortgage. She on the other hand has a home she previously purchased and pays the mortgage for her house. If they are divorced,  the two homes will be evaluated and then the amount will be divided in two with each getting half of the total.   

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