Sharing the Matrimonial Home on Separation

You may have to share 100% of the value of a home you owned alone before marriage.

This is the second in a three part series on matrimonial homes.  This series will provide information on (1) what a matrimonial home is and some special rules, (2) how a matrimonial home is treated in the equalization process, and (3) exclusive possession of a matrimonial home.

How is property normally treated upon separation?

For the purposes of this post, I am providing a very basic explanation of the equalization of net family properties, which is the process of dividing property (including debts) upon separation.  More information on this process will be provided in a future post.

Very generally speaking, when a couple separates, they share in the increase of their net worth over the course of the marriage.  This is called your net family property.  This means that you would share a bank account, vehicle or even repayment of debt like this:

How is a matrimonial home treated differently?

The matrimonial home is one of the most significant exceptions in the equalization process, because you may not receive a “date of marriage deduction” for the matrimonial home.  

If you own your matrimonial home on the date of marriage, and you still own the same home and it is still your matrimonial home on the date of separation, you do not share only the increase in its value.  You share the entire value of the house.  

However, this exception will not apply if you no longer own the home on the date of separation, or it is no longer a matrimonial home, as the definition is restricted to the home or homes you ordinarily occupy at the time of separation.

This special treatment of can make a significant difference in the equalization payment.

For example:

Even if you do not sell your home during the marriage, the exception may also not apply if you have a signed an agreement that states this.  If you are bringing a home into your marriage, it is important to consider whether you should enter into such an agreement to protect your investment.