While not every separation is as dramatic as the movies make them seem, even the most amicable divorce can be one of the most stressful and emotional events in your life. Getting divorced is not something anyone takes lightly, and this monumental decision is followed up by several more important choices, and, in some cases, a completely different life ahead of you to reconcile with. 

I empathize completely with couples who are going through it. It’s not pleasant, no matter what terms you are on with your spouse. 

Although we are not lawyers and cannot provide you with legal advice, there is one thing our divorcing clients come to us for–and that’s deciding what to do with the house. 

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Your home is likely your largest asset, in legalese it’s called the “matrimonial home” and basically it’s the property that at least one person in the partnership has an interest in, and serves as the family residence at the time of the separation. 

When you decide to uncouple, there are four main ways the matrimonial home is handled. Here they are:

1. Sell the House and Split the Proceeds

For some, this might feel like the easiest way to go about things. It sounds easy enough, right? However, there are several things you need to consider before you go this route. 

• You need to determine the value of the home. 
• You need to determine the scope of the real estate fees, mortgage penalties, and other fees that might eat into the profit of the sale. 
• Refer to your separation agreement to find out the exact split of the proceeds. Depending on a number of factors (including laws in your province, original down payment, and more), the split might not be 50/50. 

Before taking any action, it’s a good idea to discuss these things with your spouse and legal representatives to find out if this option is right for you. 

Selling your home in the near future? Here are some helpful resources to think about:

• Should You Hire Your BFF to Sell Your Home?
• 4 Reasons Why Your Home Isn’t Selling
• Things to Know About Selling Your Home in a Shifting Market

2. You Buy Your Spouse Out 

If you would like to stay in the matrimonial home, you have the option to buy out your spouse. This would be a great option if moving out will be harder for you or if you’d prefer to stay comfortable in a familiar home close to your kids’ schools or family, etc. 

If you decide that you want to buy out your spouse, you will need to have a conversation with your lender to figure out if you can afford to buy them out initially, and if you can afford the monthly mortgage payments on your own. You don’t want to end up housepoor. 

Do you have more questions about selling your home? Read our top Seller FAQ’s right here.

3. Your Spouse Buys You Out 

If you can buy them out, they can also opt to do the same. The benefit here is that you will get a fresh start with extra cash in hand. You can move forward and buy something for yourself. 

However, keep in mind that it may be harder for your spouse to qualify for a mortgage to buy you out. In some cases, we have seen spouses stay on as co-signers for the matrimonial home. 

This could help your spouse qualify to pay you, but it would mean that you won’t get any benefit of owning the property, but your debt-to-income ratio will be impacted if you try to apply for financing yourself. 

If you are bought out by your spouse, you’ll need to find somewhere new to live. Here are some buyer resources to help you get started:

• 5 Loft Considerations You May Not Have Thought About
• Spilling the Tea on Your Top 8 Buyer FAQs
• Toronto Loft Lingo and Who Actually Buys them

4. Everyone Decides that Nothing Should Change 

In some cases, you and your spouse may decide that nothing needs to change, and everyone gets to retain the home. For some, this could work if they have kids and want to keep one spouse living in the home with the family. 

For a lot of people, this arrangement is temporary, but it could work for some. The one consideration with this route is to make sure you are mindful of how it will impact your taxes. 

For Best Results–Open Communication 

In my time helping divorcees sell real estate, I’ve noticed a few things. 

First of all, the best cases are always between couples who are open and honest with each other. The couples who work together toward a common goal and have a hand in all aspects of the sale are often the ones who come out on top. 

Divorce is such a sensitive topic, and emotions are bound to run high. But if you think logically and make decisions with the head rather than the heart, you can make the process a lot easier for you and your family. 

Do you have questions about selling a matrimonial home? I’m always happy to help! Call or text me at 647-973-8392 to start the conversation.