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How to Keep the House in a Divorce: A Guide for Ontario Residents

Divorce can be an emotionally and financially challenging experience, particularly when it comes to dividing assets. One of the most significant assets in a marriage is often the family home. For many, keeping the house is not just about retaining property; it's about maintaining stability and continuity, especially if children are involved. This detailed guide explores how you can keep the house during a divorce in Ontario, considering the Canadian legal framework.


Understanding Property Division Laws in Ontario


handing over keys house

In Ontario, the Family Law Act governs the division of marital property. The principle of "equalization of net family property" means that each spouse is entitled to an equal share of the combined value of their properties acquired during the marriage, minus debts.


Key Terms:

  • Net Family Property (NFP): The total value of assets owned by each spouse at the end of the marriage, minus the value of assets owned at the start of the marriage and any debts.

  • Equalization Payment: If one spouse’s NFP is higher than the other’s, they must pay half the difference to the other spouse.



Steps to Keep the House in a Divorce


  1. Determine the House's Value:

  • Get a professional appraisal to determine the current market value of your home.

  • Agree on the valuation with your spouse or obtain multiple appraisals if necessary.

  1. Evaluate Your Financial Situation:

  • Assess whether you can afford to keep the home, considering mortgage payments, property taxes, and maintenance costs.

  • Review your income, savings, and creditworthiness to qualify for refinancing if needed.

  1. Negotiate with Your Spouse:

  • Discuss the possibility of keeping the house during mediation sessions. Divorce is Simple offers both online and in-person mediation services in Burlington to help facilitate these negotiations.

  • Propose a buyout where you compensate your spouse for their share of the house's equity. This can be done through cash, other assets, or arranging a new mortgage.

  1. Consider Other Assets:

  • Examine your overall asset pool to see if you can trade other valuable assets for the house.

  • Be prepared to give up claims on other marital assets such as retirement accounts, vehicles, or investments.

  1. Refinance the Mortgage:

  • If you need to refinance to buy out your spouse, work with lenders to secure a mortgage in your name alone.

  • Ensure you meet all the lender’s requirements and gather necessary documentation such as proof of income, credit reports, and asset statements.

  1. Legal Agreement:

  • Once negotiations are successful, have the terms of the agreement documented in a legally binding separation agreement.

  • Ensure the agreement details the division of property, financial obligations, and any agreed-upon buyout terms.

  1. Court Approval:

  • Although most divorces do not require a trial, the court must approve the final agreement.

  • Submit the separation agreement to the Ontario Superior Court of Justice for approval.



house money


Tips for Successful Mediation


  • Choose an Experienced Mediator: At Divorce is Simple, our mediators are skilled in handling complex property divisions and can guide both parties to a fair resolution.

  • Stay Open-Minded: Be prepared to compromise and explore creative solutions that benefit both parties.

  • Focus on Children: If you have children, prioritize their needs and stability when negotiating the division of assets.



Legal Requirements and Documentation


  • Separation Agreement: This document outlines the terms of your property division and must be signed by both parties in the presence of a witness.

  • Certificate of Independent Legal Advice (ILA): Both spouses should seek independent legal advice to ensure the agreement is fair and understood.

  • Court Filing: File the separation agreement and any necessary forms with the court to finalize the divorce.


Conclusion


Keeping the house in a divorce requires careful planning, open communication, and a thorough understanding of Ontario’s property division laws. By working with experienced mediators at Divorce is Simple, you can navigate this process more smoothly, ensuring a fair and equitable outcome for both parties. Remember, the goal is to reach an agreement that provides financial stability and meets the needs of everyone involved.


For more information or to schedule a mediation session, contact  Divorce is Simple, today.



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