When a breakdown of a marriage occurs, whether it be a separation to divorce, there are several things to consider concerning homeownership. But, what if you and your spouse cannot agree on how property is divided? In Ontario divorce law falls under the Family Law Act. it ensures the couples leave the marriage on a relatively equal footing.
According to Canadian Law, “The value of any kind of property that was acquired by a spouse during the marriage and still exists at separation, must be divided equally between spouses.” During the divorce process, certain property values will be included and excluded in the calculation of equal payments that one spouse will pay the other.
Yes, it seems to be confusing, but the division of assets in Ontario doesn’t have to be painful. Here’s what you need to know about the division of property in Ontario Canada.
In Ontario, the divorce law focuses on the principle of “all things equal”, which means you and your spouse keep an equal amount of whatever you earned during your marriage that is called a net family property (NFP) Calculation. To determine your NFP, you and your spouse both fill out copies of Form 13.1 financial situation. The form asks each of you to combine all your assets and then subtract your debts from them (both values are from the day of your separation). Then, both spouses must determine what assets you had in your name before you got married. These remain yours at the dissolution of your marriage unless you negotiate otherwise. So, you subtract them from your NFP.
You and your partner may not have the same NFP calculation.
The person with the highest NFP owes their soon-to-be-ex half of the difference between their two figures. The difference is your equalization payment.
For example, if one partner has an NFP of $100,000 and the other partner has an NFP of $30,000, then the difference is $70,000. The partner with the higher NFP then pays a $35,000 equalization payment to the other.
The Matrimonial Home:
Unlike most other assets, the matrimonial home is treated specially.
A family home is a special place. It is where you live and where your children feel most comfortable. If you own your home, it may be the most valuable thing you own. If you purchased a home together after marriage, it is the matrimonial home automatically. Selling the matrimonial home during the marriage also affects property division.
When you separate, both of you may want to stay in the family home. If you cannot agree on who should stay in the family home, you can use lawyers, a mediator, or an arbitrator to help you decide, or you may have to go to court to have the judge decide. An order or agreement for exclusive possession allows one spouse to use it, but not the other.
It may be that, after the separation, neither of you will be able to afford to stay in your home.
If you have children, the person who has custody of the children will most often be the one who stays in the family home with the children. This helps children adjust to their new family situation in a place and neighborhood that they already know.
Dealing with a divorce is difficult. A reliable lawyer can be an invaluable resource as you navigate this new phase of your life. Lez Gomez the best mortgage agent in Toronto can help you find the best Family Lawyer, who has helped countless people and families through the process of property division, division of assets, and mediation.