Property division/co-habitation agreement/child
How would a situation like this play out? Currently my GF and I both own our own separate homes. We've been together 10 years. Her home is fully paid off and is worth $270,000. My home is worth $440,000 and I owe $220,000 on the mortgage. So she's got around $50,000 more property equity than I do.
My GF has done well for herself. She has a high paying career (same salary as me), her house is paid off, has a good pension, and is close to maxing out her TFSA and RRSPs. I want nothing from her, I just want to protect what I've worked hard for up to this point in my life, in the event of a separation. Plus my home has some money in it from a small inheritance I received when my Grandpa passed away.
Now let's say we decide to move into my home (because it's bigger), have a kid and she sells her home. How can I protect the $200,000 equity I have in my home in the event of a separation? We want to keep what we have now separate, but anything after having the child would be combined property equity and split in the event of a separation. She wants to ensure she can buy another property in the event we separate.
Basically I want to ensure I don't lose my $200,000 equity in my current home in the event of a separation. I don't think it'd be fair that I have to split that equity, yet she keeps the full $270,000 from the sale of her home.
Hope this makes sense. Please ask any questions if I missed anything. Thank you in advance.
Posted Sep 21, 2020, 2:31 AM UTC
There are very set out common law rules for this. Maybe talk to a family lawyer to find out for sure, but as I said, this is not new territory, so googling family law in Canada for this kind of thing should get you some good info to start from.
From what I remember, If you are common law, whatever you pay into the home is what you will get out of it. If she sold her home, and paid off your mortgage, you would both get back whatever percent you had put into it at the time. From there I would divide the bills, she gets some in her name, you get others that balance out to make it 50/50 to keep it simple for later.
Once you have a kid, I’m not sure the rules. I think it would probably be something like marriage, where whoever stays home is counted as a full time job, and they would “earn” half the wage of the other person. Then alimony and child support may play a role. I am very unsure of the part with the kid though, but that’s where a lawyer will help you.
If you do end up getting married I believe everything resets to 50/50 u less you have a prenup.
I also feel like you should also be able to do a cohabital prenup.
Edit: just went back and reread your post... it’s none of my business but if she sells her home and won’t settle your mortgage while moving in and having a kid... that doesn’t quite sound like a good deal.
Edit 2: damn, drinking whiskey and skimming posts doesn’t pay... inheritance is also considered differently. I want to say it’s exempt from the “what you put in is what you get out”, in that inheritance is always yours.
Long story short, keep It wrapped up until you talk to a lawyer I think.