The Matrimonial Home- Purchasing One Party’s Interest in the House

The Matrimonial Home is, in many cases, the separating parties most valuable asset.  The parties wish to obtain their equity from the house and move on with their lives.    How does this work?   Either the parties agree to list the house for sale or one party can purchase the other party’s interest the Matrimonial Home.  This normally takes place after discussing their options with a family lawyer.  It is noteworthy that the courts, in most cases, cannot force one spouse to purchase the other spouse’s interest in the Matrimonial Home.  However, if the parties are agreeable, the parties have to agree on the process to determine the value of the Matrimonial Home and how the purchase price will be determined.

If the house is going to be valued, the parties can either retain a real estate agent to give an opinion as to the value of the house (this is not necessarily dependable and may be influenced by the agent’s desire to obtain the listing), or obtain an certified appraisal of the house.  If the house is going to be appraised, the parties should obtain an accredited real estate appraiser (the person will have designations “AACI” or “CRA”).  The parties then have to decide if there is going to any deduction for “notional disposition costs” (ie. if the house is going to be sold on the open market, the parties would use a real estate agent and pay commission from at least 3.5% – 5%) .

Usually, the party selling their interest in the house to the other party, would argue that the commission should be minimal because the other party will likely not sell the house for quite some time.  The party purchasing the other party’s interest would argue that there is an inherent cost in selling a house and it is unlikely that it would ever be sold privately.   Sometimes either of the parties can be emotionally attached to the house and resist selling the house or buying the other parties interest in the house.  If this is the case, it will be necessary to go to court and force the sale of the house.