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Real Estate and Divorce

December 27, 2009


Many of us know the sorrow of a separation leading to divorce. Not only is there the emotional pain there is a financial element that has to be dealt with. Along with visitation of children the division of assets is one of the most contentious issues.

How do you divide a home? A home in which both partners lived in, loved and created memories in. We are often emotionally invested in our homes and they are one of the hardest assets to part with.

Ultimately as you and your partner lived in the home together, equity in the property was created. So is co-ownership the best route for you to follow, or maybe taking sole-possession is the most effective way to deal with the issue. In most cases it comes down to selling the home and dividing the cash equity in the property.

Co-ownership is obviously the most unique of the three options. Co-ownership can be crafted into the divorce agreement, usually for a fixed number of years. You and your ex-spouse both retain an ownership interest in the property and in the event the home is sold have the option to recoup the equity in the home. The catch here is that both parties are tied to that property and ownership in it could prevent one or both parties from acquiring another mortgage.

Taking sole-possession is far more common and this occurs when one party purchases the others ownership interest in the home. This often means transferring the mortgage into that individuals name and removing them from the properties title.


Selling the property to a third party is the most common option that couples pursue. It eliminates arguments over value and ownership leaving it a simple division of dollars. This may be a cloudy issue depending on the tension between both parties.

Did one partner have a greater interest in the property (i.e. paid a great portion of the down payment, added addition value through sweat equity and so on)? This all needs to be looked at in detail by a legal profession prior to a final decision of value can be assigned to each party.

Obviously counseling and reconciliation is cheaper than divorce so try to work things out. But if you cannot, seek advice from a professional. Decide with your ex which method of distribution of assets works best for you and try to be as equitable with one another as possible

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Laddi Dhillon
Sales Representative

RE/MAX Gold Realty Inc.Brokerage
Independently owned and operated

2980 Drew Rd Unit 231
Mississauga, Ontario L4T 0A7

Phone:905-598-0725 905-598-0725


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