How Long Will it Take to Buy Out Your Spouse After a Divorce?

May 12, 2023 / Buying

In the world of real estate, divorce isn’t always the easiest topic to discuss. However, it is important.  

When one partner wishes to stay in the home following a divorce, they’ll need to buy out the other’s share in it. While this may seem fairly straightforward on paper, there are a lot more details to sort out than you may think. 

Understanding the buyout process is incredibly important because it often needs to be completed before a divorce can be finalized. In this blog post, we’ll look at buyouts, what’s involved, and which factors will impact the completion timeline. 

Want to learn more about working with a real estate agent in the event of a divorce? Click here to read our blog post on the topic

Spousal Buyouts at a Glance

Generally speaking, divorce already involves a number of legal processes, logistics, and paperwork. The real estate side of the equation is no different. 

Divorce can be an incredibly difficult experience, and while you may wish to get through the buyout process as fast as possible, it’s important to recognize that things will take some time. Even though the home isn’t being listed on the market, partner buyouts still qualify as formal real estate transactions. With this in mind, there’s still a handful of key details and logistics to sort out before everything is completed and finalized. 

As a first step, you and your former spouse must have a signed separation agreement in place before you can proceed with the buyout. This document will cover a number of important details and your lawyer can help you draft and sign it.

The Matrimonial Home

Under Ontario law, both spouses automatically have equal rights to their shared home (different rules apply to non-married or common-law couples). This concept, which is also known as the ‘Matrimonial Home’ is designed to ensure both parties interests are protected in the event of a divorce. 

When a divorced couple decides to sell the home together, this law ensures proceeds are distributed fairly. In the event of one partner buying out the other, it determines (among other factors) how much the purchasing spouse will owe the other. 


In need of specialized real estate advice? You may find these blog posts helpful. 


How it Works 

When one partner buys out the other, they’re essentially taking on the remaining amount of the mortgage, plus any outstanding equity associated with the home’s market value – more on that later. On top of the financial elements, it also involves the legal steps of removing one spouse from the title of the home. 

When it comes to the actual purchase itself, one thing to note is that there is actually more than one way to pay it off. Usually, the purchasing partner will simply increase their monthly mortgage payment amount to reflect the amount owed to their former spouse, however, there are other ways to complete the process too. 

If you’re preparing to buy out your former spouse’s share of the mortgage, talk to your financial planner or accountant first. They’ll help you assess the situation and choose the right path forward. 

Who Keeps the Home?

The first major decision of the buyout process is determining which partner keeps the home. Ideally, you and your former spouse will already have an idea of who is staying and who will be moving out. 

In most cases, children are the determining factor in this decision. For instance, if one partner will hold primary custody, it’s often easiest for them to remain in the home. That way the children will be able to stay near school, friends, and in the home and neighbourhood they’re most familiar with. 


Downsizing to a smaller living space following a divorce? Explore these related readings for helpful tips. 


Accounting For Equity

One of the more unique steps involved in a spousal buyout is determining how much equity the home has accrued since you moved in. 

Depending on when the home was first purchased, there’s a strong possibility that it has since increased in value. As a result, you and your former spouse will need to agree on a current market value. While there’s no universal formula to determine what the property is now worth, your real estate agent can help you calculate a fair and accurate estimate. 

We understand that the real estate steps of divorce can be challenging, and we’re happy to provide you with empathetic, personalized guidance on this unique process. Click here to send us an email or give us a call at 416-571-2724.

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