Relationships and mortgages


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Relationships and mortgages – what happens if the worst happens?

Relationships and mortgages – what happens if the worst happens?


Summertime is one of the busiest times for the housing market. Surprising? Maybe not. With the beautiful weather, many house hunters spend more time outdoors looking at properties. This is partly due to the great weather, and the fact that if you must move, you would much rather do it when it isn’t freezing cold during the middle of winter!

In today’s culture, many couples are choosing to remain common-law rather than getting married. While both marriage and common-law relationships have many similarities in the eyes of the government, when it comes to owning a house, it is important to know your rights as a homeowner in case a separation ever does occur.

Each province has a slightly different definition and time frame when it comes to what qualifies as a common-law partnership. It is important to know what the law is in your province so that if a separation does occur, both parties will be aware of their rights. For instance, in British Columbia, childless common-law partners that have lived together for two years or more have the same legal rights as married couples when it comes to the equal allocation of assets and debts. So after two years, if a separation occurs, each partner is entitled to 50% of the assets, including any properties that are owned by the couple.

While it is important to know your rights if a separation occurs in either a marriage or a common-law relationship, it is also important to know what may occur if one of the partners were to pass away. If a death occurs, properties can be transferred depending on two options of how the owners are on title of the property.

The first way is known as “joint tenants”, which mean that each person has an equal share in the property. In relation to two people, each would have a 50% share. If one of the individuals were to pass away, their share of the home or property would be transferred to the other individual, leaving them with 100% of the ownership.

The second option is “tenants in common”, which means that each partner owns a specified amount of interest in the property. This allocation can be split on whatever percentage the owners choose, but is often distributed on a 99:1 ratio in instances that one of the buyers is a first time home buyer. In this case, the first time home buyer would claim the 99% interest in the property to take advantage of the first time home buyer tax exemption that is available in British Columbia. If one of the partners were to pass away in a tenants in common situation, their will would need to specify who will receive their share of the ownership.

This may not be an easy topic to discuss with your partner, but it is an important issue that should be discussed in case the unthinkable were to happen. If you are unsure about your options or what is best for you, we highly recommend getting legal advice from a lawyer on what your options are. Once this is done, you can rest assured and enjoy the sunshine while house hunting for that perfect dream home!

1 Comment

  1. Kathy Herrington
    August 25, 2016

    Every time we have used Tecamar we have been happy with the effort that went into finding us the best mortgage rate and the personal care they have given us. We would highly recommend their services. Thank you again.

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