Notional Costs

[Gwen]

I am attempting to get a separation agreement but having some difficulty with this issue.

My wife is going to be taking over the home and we have agreed on a price.

The stickler is that her lawyer is requesting "notional" costs of 10% of the agreed on price as costs relating to the tranferring the property to my wife's name. Her lawyer wants these costs as if the home was being sold on the real estate market.

I have agreed to pay actual transfer costs which should be minimal considering that there are no land transfer taxes and the mortgage is assumable but "no go".

Has anyone heard of such costs & how did you handle them in your situation.

G

[Gwen]

My lawyer has responded to my exes lawyer that I will not be paying notional costs.

As well, considering that this whole thing has been going back & forth, I'm taking a stand that this is my offer - take it or we're going to court. I'm tired of this lawyer to lawyer "stuff". I just want to get it over with!

G

[logicalvelocity]

I'm not sure if I got it right.... but to my understanding is that a lawyer charges about 1% to 2% to transfer title of a home. This include assessment office searces and leans on the title and transfer of the assumable mortgage. The other thing is that your separation agreement has to detail to transaction.

10% of the value sounds kind of steep in my books and would be somewhat gouging in my eyes. I am not sure why you are paying for your wife's lawyer to do this task. I think the responsibility lies with your wife to pay for this expense as she will be owning the home subsequently.

[Grace]

Is this the same as Dispositions Costs? If so mine are calculated at 6% which includes realtor fees and legal costs. So 10% sounds very high.

[Gwen]

The home is not being sold but being transferred to my spouse. Her lawyer wants 10% of the value of the home to be applied towards any costs of a future sale of the home when my wife will own the home in full.

I have already agreed to a price that is below the appraised cost - the appraisal was obtained for the division of matrimonial assets.

My wife is not assuming the existing mortgage but is having a new one drawn up as she has accumulated some debts (due to her excessive spending habits) since we separated and wants to consolidate. I am agreeable to paying 1/2 of the interest penalty on the existing mortgage.

G

[logicalvelocity]

I don't think that is right that her lawyer wants you to pay 10% of the value of the home if sold in the future. This responsibilty lies with the owner.


I believe also that this amount is excluded from liabilities in net equalization payments. Sounds like her lawyer is attempting to scam you and your own lawyer should be up on that. The onus for these charges belongs to whomever keeps the house.

[Gwen]

.... Exactly my reasoning. Ironical in that my wife called me up to advise me that if things weren't done by month end, that her lawyer would be going to court. I advised her that my final offer had gone to her lawyer and the only (2) issues remaining are the notional costs and the support of my adult daughter. I will not bend on these issues as I've made enough consessions to her regarding the house price and all of the contents.

We did talk & it would appear that she is willing to waive the notional costs for future sale of the home but she's questionable about child support for our 20 year old daughter who lives with her boyfriend.

I told her that we could just throw everything to the lawyers as they're going to get it anyway if we go to court for such minimal issues. If we do go to court, I'll be going after the full appraised value of the house, take my portion of household contents & go after child support for the time the kids were with me in a full time capacity - I won't spend legal $$$ for nothing. Fair is fair & if she wants to fight, then that's what it will be. I'm just hoping that her lawyer will be reasonable and back off on the "off to court" at any cost.

Wish me luck!

Gwen

G