When you and your spouse decide to separate, there are of course many factors to consider and decisions to be made. One of the most important is the division of financial responsibilities. Your monthly expenses, such as the mortgage and utility bills, will continue during the separation process, and the question of who will pay them is a tricky one to answer. There isn’t an automatic solution, and in fact the sometimes the answer can change depending on whether you are legally married or in a common-law partnership.
First Steps to Separation: Financial Checklist
It’s extremely important that everyone is on the same page when it comes to finances during a separation or divorce. Gathering up all of your financial documents is an essential first step. These should include:
- Lease or rental agreements
- Mortgage documents
- Shared credit card statements
- Joint bank account statements
- Shared utility bills
- Vehicle payments
- Any other shared financial responsibilities, including child care, health care, and pet-related costs
Who Pays the Mortgage During a Separation?
If you and your spouse own property jointly, there are more factors consider than just the mortgage payments. The matrimonial home – or the property that you own, both live in, and are using at the time of separation – requires special consideration.
If you are married, each spouse has a legal right to half the value of the matrimonial home. This means that neither partner can be forced out of the house, and neither of you can make financial decisions regarding the property (selling it, renting it out, etc.) without permission from the other spouse. However, if you are in a common-law partnership rather than being legally married, then the home belongs solely to the person whose name is on the deed, no matter how long you’ve lived together.
When deciding what to do with the marital home, previous cases have shown that the courts will consider factors such as:
- Each spouse’s behaviour toward the other
- Whether domestic abuse caused one partner to leave the home
- Whether children live in the home with one spouse (see also our article on child support)
In some cases, occupational rent may be due. This is money paid by the resident spouse to the non-resident spouse for the right to occupy the home. If you are the non-resident spouse, this can help offset the cost of having to find another place to live during your divorce. Deciding whether occupational rent is due can be tricky and depends on many factors, so take a close look at your situation to see whether it applies.
Questions to Consider Before Making Any Decisions
To help you figure out what to do with the marital home, ask yourselves the following questions:
- Will you both live in the home? If so, you can continue to pay the mortgage the same way you always have until one or both of you moves out.
- Will you sell the property? This is often the hardest decision to make. If you and your spouse can’t come to an agreement on whether or not to sell, you can ask a judge to order the sale of the house and set the conditions of the sale. A full appraisal will be required to determine the fair market value of the home.
- Who is able to access the house? If only one of you stays in the house, will the non-resident spouse be able to enter the home? Under what conditions? It’s very important that both of you are on the same page here.
- Who will be responsible for upkeep of the home? Things like mowing the lawn, emptying the eavestroughs, and watering the gardens still need to be taken care of. Be sure to discuss upkeep of the house and decide who will be responsible for which tasks.
Under Ontario’s Family Law Act, the court can order exclusive possession, which forces one spouse to leave the home. The court can also issue orders regarding which payments must be made by which spouse. Additionally, if one spouse stops paying their agreed-upon share of the expenses, the other partner should keep proof of payment and ask for reimbursement in court.
If you rent or lease your home rather than own it, this situation will vary depending on the lease agreement. Usually, the spouse who signed the lease is responsible for paying the rent.
Galbraith Family Law Can Help You Answer These Questions
Figuring out all the details of your finances is one of the most difficult aspects of ending a marriage or partnership. Galbraith Family Law can help you answer all of these questions and more. Instead of trying to figure everything out on your own, contact us by sending a message through our website or by giving us a call. Our Newmarket office is at (289) 802-2433 and our Barrie office is at (705) 302-1102.