Ottawa Divorce .com Forums


User CP

New posts

Advertising

  Ottawa Divorce .com Forums > Main Category > Divorce & Family Law > Common Law Issues

Common Law Issues The law regarding common law relationships is different than in cases of divorce. Discuss the issues that affect unmarried couples here.

Closed Thread
 
Thread Tools
  #1  
Old 04-05-2011, 10:48 PM
Confused2 Confused2 is offline
Junior Member
 
Join Date: Apr 2011
Posts: 3
Confused2 is on a distinguished road
Red face Need a little help!

Hi,
One month ago my CL partner and I purchased a condo together. I paid $24K and she contributed $1K and has her name on the title (so she owns half). Now we have decided to split. I make about 40K more then her salary and offered to buy her out (1/2 the difference of the mortgage and value as of one month ago. She requested an appraisal so I obliged and booked an appraisal for Friday. Unfortunately I used the Home Buyers RRSP initiative for the down payment and could face a tax issue if we sell in a year...so needless to say I don't want to sell because we won't break even and I get hit with a penalty. Will a judge or arbitrator take my contribution and possible tax penalty into consideration if we can't amicably come to an agreement. If anyone has any insights on a similar situation or advice I'd love to hear about it?

Also, I was hoping someone has some insights as to support payments, since I earn more I assume I will have to make payments to here. What is considered in judging the amount of support one should pay? I guess I'm hoping to make her an offer and try to keep legal fees to a minimum.

Thanks for reading my post,
Confused2
  #2  
Old 04-05-2011, 11:00 PM
paris paris is offline
Senior Member
 
Join Date: Jun 2007
Posts: 571
paris is on a distinguished road
Default

One month? Seriously? Give her back her $1,000. An appraisal will probably cost you that much. You don't have to give her half of the equity. That's half of your downpayment.

Are you wanting to keep the condo yourself? You should be able to reimburse her and take her name off the title. If you sell it you'll have the RRSP tax issue to deal with and the interest you'll have to pay to the bank for backing out of your mortgage term.

How long were you commonlaw? Spousal Support isn't always required, and also depends on the number of years you were together.
  #3  
Old 04-05-2011, 11:00 PM
dadtotheend's Avatar
dadtotheend dadtotheend is offline
Senior Member
 
Join Date: Jul 2007
Location: Toronto
Posts: 3,644
dadtotheend will become famous soon enoughdadtotheend will become famous soon enough
Default

Quote:
Originally Posted by Confused2 View Post
Unfortunately I used the Home Buyers RRSP initiative for the down payment and could face a tax issue if we sell in a year...
What tax issue? With respect to the Home Buyer's Plan?
  #4  
Old 04-05-2011, 11:19 PM
Confused2 Confused2 is offline
Junior Member
 
Join Date: Apr 2011
Posts: 3
Confused2 is on a distinguished road
Default

Firstly thank you for the quick replys.

Paris,
We are common law by the skin of our teeth. She is demanding the appraisal. I think its ridiculous because we only just purchased and the market value would be what we paid for it.
I hope I'm wrong but isn't she entitled to half the equity or just her downpayment?

Dadtotheend,
I'm of the understanding I need to occupy the residence for 1 year prior to selling or renting or pay the tax on the withdrawal amount. I maybe wrong and apologize if I've posted in error.

It sounds like I should seek out a lawyer either way.
Thanks again,
Confused2
  #5  
Old 04-06-2011, 11:11 AM
KanataKathy KanataKathy is offline
Member
 
Join Date: Jan 2010
Posts: 36
KanataKathy is on a distinguished road
Default

Confused2;

Offer her $1k, contingent on her signing all documentation to take her name off title. Agree to pay the real estate lawyers fees. Hope like hell it ends amicably at this point.

1st fallback position. Look up the Teranet stats for your location. Offer her 50% of any price increase in the house, plus her original $1k, contingent on her signing all documentation to take her name off title. Agree to pay the real estate laywers fees. Hope like hell it ends amicably at this point.

2nd fallback position. Have the house appraised. This will cost you around $300-$500. Etc, etc, etc. (per above).

If you have to take this to family law court to have it settled for you, it will cost you both big time in lawyers fees, and you will likely end up with with a payout per 1 or 2. Been there, done that, bought the T-shirt...
  #6  
Old 04-06-2011, 04:05 PM
paris paris is offline
Senior Member
 
Join Date: Jun 2007
Posts: 571
paris is on a distinguished road
Default

Quote:
Originally Posted by Confused2 View Post
Firstly thank you for the quick replys.

We are common law by the skin of our teeth.

Confused2
You don't owe her spousal support.
  #7  
Old 04-06-2011, 07:15 PM
Lautario Lautario is offline
Junior Member
 
Join Date: Feb 2011
Posts: 18
Lautario is on a distinguished road
Default

IF you are considered Cl, then apply for a separation agreement and get in court ASAP and have a Judge make a court order. Only one of you can get the place, but keep in mind, as CL you did not make a 24k contribution and she a 1k, the two of you made a 25k - half belongs to her, half to you. Half the equity is hers, so offer 12k minus half of what the the costs of selling would be. Trust me, this is a lot cheaper that 25k to have a lawyer settle it for you - and you still need to pay her half.

Next time, be sure to have a pre-nup
  #8  
Old 04-06-2011, 07:46 PM
NBDad's Avatar
NBDad NBDad is offline
Senior Member
 
Join Date: Dec 2009
Location: New Brunswick
Posts: 2,734
NBDad is on a distinguished road
Default

Check the laws in your area. It varies, often wildly in a common law relationship. (How long have you been living together as a couple?)

Typically you leave with what you paid out, she leaves with what she paid out. If you want the house you pay her her share of the equity, which is at most 1000 + the increase in value less the appraisal fees (as she has demanded it).

IF SHE wants the house, she can pay you the 24K.

That's typically what would be ordered...if she refuses, then draw a line in the sand and go get a court order, don't forget to ask for fees for her being a dumbass.
  #9  
Old 04-08-2011, 10:52 PM
Confused2 Confused2 is offline
Junior Member
 
Join Date: Apr 2011
Posts: 3
Confused2 is on a distinguished road
Default

Thanks for the advice. It's much appreciated. She seems to be coming around that the money she could gain would most likely be eaten up by lawyer fees if she choose that path. The replies are much appreciated.
  #10  
Old 04-08-2011, 11:55 PM
dadtotheend's Avatar
dadtotheend dadtotheend is offline
Senior Member
 
Join Date: Jul 2007
Location: Toronto
Posts: 3,644
dadtotheend will become famous soon enoughdadtotheend will become famous soon enough
Default

There is no tax consequence for selling within a year.

You just have to stick to the regular HBP repayment requirements.
Closed Thread

Tags
common law, seperation, support, tax


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is On



All times are GMT -4. The time now is 03:45 PM.