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Financial Issues This forum is for discussing any of the financial issues involved in your divorce.

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Old 06-12-2006, 03:22 PM
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Default Needed advices for prenuptial agreement and matrimonial property.

Hello all experts, I am from Ontario and have a few financial questions to ask you about prenuptial agreement and matrimonial property. Currently i am confused and not sure what action to take to protect myself. Here is my story and please advise. Thanks.


Currently, i own a house which I am currently living in. The house is registered under name ONLY and still have a mortgage to pay off. I will be getting married in August this year and have been advised by friends/relatives that i should get a prenuptial agreement done prior the wedding date to protect my assets. In the event, my marriage does not work out down the road, i don't want to be shared 50/50 to my ex-wife if the event of devoice. Not that i don't want to share the 50/50 because my future wife did not put any $$$$ to the mortgage or downpayment at all. So far she has not spent a cent to maintain the house. Therefore, all i want is to protect my asset and financial for what i have owned prior the marriage.

Here are my questions:

1) Will a prenuptial agreement protect me or work for me? Should i go and get it done prior the marriage?


2) Is it true that my house will be considered as matrimonial property after we live there together after we get married?


3) Is it true that a matrimonial property will be automatically shared 50/50 regardless who is registered to the property? For example, i am currently the ONLY owner to this property. After my marriage, my wife will automatic share 50/50 even her name is not added to the property.


4) What is going to happen to my RRSPs and bank accounts registered ONLY under my name? Will my wife also automatic share 50/50 regardless who is the beneficial?


5) On the other hands, will I be able to share 50/50 of my wife RRSPs, bank accounts or stocks which my name is not currently registered to it?


6) What if my wife ends up buying a rental property using her own $$$$ prior or after our marriage but only registered to her name, will I be able to share 50/50 of those? What is the advantage to her or disadvantage to me with this scenario?


7) What if i ends up sharing the cost of the rental property but only her name is registered to this property, what is my lost for doing this and should i always add my name of all rental properties which she will be owning in the future?


8) After our marriage, my wife is willing to share the mortgage cost (approx $100,000) of a matrimonial property, who will get what % of the property in the event of separation?

9) Writing up a prenuptial agreement, does it need to run by her or inform her or her signature? Can i keep it secret somewhere until i need to use it?




=========

As you all know that marriage is very fragile these days and you can always hope for the best and last for life time. I just want to do things to be fair to both of us and not ridding off each others. It took me years to save enough $$$$ for down payment of the house and i don't like someone to steal half of my savings in a second in the event of separation. Therefore, i really need someone expert in this forum to give me some advices on how to protect my asset and financial. Please advise. Thanks


David.
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Old 06-12-2006, 11:36 PM
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Hi David and welcome to the forums!

Quote:
Originally Posted by davidyuz
Currently, i own a house which I am currently living in. The house is registered under name ONLY and still have a mortgage to pay off. I will be getting married in August this year and have been advised by friends/relatives that i should get a prenuptial agreement done prior the wedding date to protect my assets. In the event, my marriage does not work out down the road, i don't want to be shared 50/50 to my ex-wife if the event of devoice. Not that i don't want to share the 50/50 because my future wife did not put any $$$$ to the mortgage or downpayment at all. So far she has not spent a cent to maintain the house. Therefore, all i want is to protect my asset and financial for what i have owned prior the marriage.
I think that if you own a home that you're going to live in once you marry, then it's a good idea to get a prenuptial agreement (known as a marriage contract in Ontario). This is because under Ontario family law, you get credit for all assets you bring into the marriage except for a matrimonial home.

So, if you have an investment portfolio worth $100,000 on the date of marriage, you would get a credit for that. But if you have $100,000 equity in your home, you would not. A lot of people view that outcome as unfair, and a marriage contract can be used to give you credit for the equity in your home on the date of marriage.

Quote:
Originally Posted by davidyuz
1) Will a prenuptial agreement protect me or work for me? Should i go and get it done prior the marriage?
Yes, a marriage contract can do exactly what you want, and it is often done in a case where one person owns a house that the couple is going to move into once married.

Definitely get the marriage contract done before you marry. Although you can get it done after you marry, it is a lot more likely to be invalidated by a court. This is because once people marry they gain certain rights. By entering into a marriage contract after you marry, you are giving up those rights. But as you don't have those rights before you marry, you aren't giving up anything by entering into a marriage contract.

Quote:
Originally Posted by davidyuz
2) Is it true that my house will be considered as matrimonial property after we live there together after we get married?
There's no such thing as "matrimonial property" in Ontario. However, once you marry, there is a good chance that your wife will be entitled to half the equity in the matrimonial home.

Quote:
Originally Posted by davidyuz
3) Is it true that a matrimonial property will be automatically shared 50/50 regardless who is registered to the property? For example, i am currently the ONLY owner to this property. After my marriage, my wife will automatic share 50/50 even her name is not added to the property.
For more details as to how property is divided, see:
http://www.ottawadivorce.com/propertydivision.htm

But basically, yes, your wife could well get half of the home. As well, she would have other rights regarding the home, such as the right to stay there even if you want her to move out, and the requirement that she signs any documents regarding the sale of the home.

Quote:
Originally Posted by davidyuz
4) What is going to happen to my RRSPs and bank accounts registered ONLY under my name? Will my wife also automatic share 50/50 regardless who is the beneficial?
See the link above regarding property division. If these are assets you own now, you will get credit for the assets you own on the date of marriage. Keep documentation as to what these assets are in a safe place.

Quote:
Originally Posted by davidyuz
5) On the other hands, will I be able to share 50/50 of my wife RRSPs, bank accounts or stocks which my name is not currently registered to it?

6) What if my wife ends up buying a rental property using her own $$$$ prior or after our marriage but only registered to her name, will I be able to share 50/50 of those? What is the advantage to her or disadvantage to me with this scenario?

7) What if i ends up sharing the cost of the rental property but only her name is registered to this property, what is my lost for doing this and should i always add my name of all rental properties which she will be owning in the future?

8) After our marriage, my wife is willing to share the mortgage cost (approx $100,000) of a matrimonial property, who will get what % of the property in the event of separation?
Pretty much the same answer as #4. If you look at the Ontario scheme for the division of property, the results are pretty much the same regardless of whose name property is held, except in extreme case (e.g. one party has a negative net worth).

Quote:
Originally Posted by davidyuz
9) Writing up a prenuptial agreement, does it need to run by her or inform her or her signature? Can i keep it secret somewhere until i need to use it?
I'm not sure what you mean by this. By definition an agreement is something voluntarily entered into, so I don't understand how you can keep a prenup a secret from your wife. You partner would need to sign the marriage contract, and in front of a witness.

While I'm a strong proponent of prenups, your comments about secrecy worry me. One thing I've learned as being key in a successful relationship is always to be completely open and honest with your partner, even if it make you look bad or shows a weakness of yours.

Quote:
Originally Posted by davidyuz
As you all know that marriage is very fragile these days and you can always hope for the best and last for life time. I just want to do things to be fair to both of us and not ridding off each others. It took me years to save enough $$$$ for down payment of the house and i don't like someone to steal half of my savings in a second in the event of separation. Therefore, i really need someone expert in this forum to give me some advices on how to protect my asset and financial. Please advise. Thanks
A prenup is just good common sense. The reality is that every married couple has a prenuptial agreement - if they don't enter into one between themselves, then they are really just signing onto a standard form marriage contract prepared by the government. By negotiating one between themselves, a couple is really just taking control of their lives and their relationship.

That being said, if your partner is unwilling to enter into a marriage contract, there are other things you can do to protect yourself -- you can simply sell the house. Or, if you have a great emotional attachment to the house and don't want to sell it, you can mortgage it to the hilt just before you get married.
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Old 06-13-2006, 11:39 PM
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Hi Jeff, thanks for your quick reply. To clarify your comment about my question #9, I thought that the prenup agreement is something that each party writes it up and keeps it for themselves until it is needed. That's where my confusion comes in. If this is true that a prenup agreement needs to be signed by both parties in front of a witness, then something i need to open up a discussion with her then. I was also told by my colleagues that if a prenup agreement is not signed by both parties, it will voided in the court. Is that true?

I will check out those links above for more information. Really appreciated your time to reply back to me. Have a great day...


David.




Quote:
Originally Posted by davidyuz
9) Writing up a prenuptial agreement, does it need to run by her or inform her or her signature? Can i keep it secret somewhere until i need to use it?


I'm not sure what you mean by this. By definition an agreement is something voluntarily entered into, so I don't understand how you can keep a prenup a secret from your wife. You partner would need to sign the marriage contract, and in front of a witness
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Old 06-14-2006, 09:33 PM
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Yes, the prenup will need to be signed by both of you. Maybe you're thinking of a will? That would set out what would happen to your assets if you passed away, and would not be something that your partner would sign.
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Old 06-16-2006, 12:13 PM
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Hi Jeff, a will can only be used for when i passed away. But it won't do any good for a marriage separation.

David.
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