Buying a Home Together as Unmarried Partners in Ontario

Buying a home together is exciting, and for unmarried couples it also carries a legal catch. The property-sharing rules that apply to married spouses on separation do not apply to you, so the paperwork you do before closing carries more weight.

This article walks through the ownership choices, how to keep track of who paid what, and the protections you can put in place. It is general information, and a lawyer can confirm how it applies to your purchase.

Why the rules are different for unmarried couples

Ontario does not divide property between common-law couples when they separate. Each partner keeps the property they bought, and neither has a right to share the other's increase in property value. Furniture and household items belong to the person who bought them.

The matrimonial home protections also do not cover unmarried partners, because "spouse" there means married spouses. In practice, what the title says and what you have agreed in writing are the main protections you have.

Joint tenancy or tenancy in common

Which one fits depends on your goals. Survivorship can pass the home to the surviving partner automatically, which matters because a common-law spouse does not inherit under the Succession Law Reform Act if there is no will. Tenancy in common lets each owner deal with their share through a will, so a will becomes important.

One detail to know: in the land titles system, a charge registered by fewer than all the joint tenants does not automatically sever the joint tenancy, and whether the owners intended to sever is a factual question for the courts.

Tracking the deposit and other contributions

If one of you pays more of the deposit or later pays down the mortgage, title alone may not tell the whole story. A common-law partner who contributed to property the other owns may have a right to part of it. Unless the owner agrees to pay the contribution back, the partner may have to go to court.

Clear records make those conversations easier, and they help a lawyer draft your agreement. Useful records include:

• Bank transfers showing who paid the deposit and when.
• Receipts for closing costs, renovations and major repairs.
• A written note of each person's starting contribution and what you intend if you separate.
• Mortgage payment records showing who paid what.

Putting your intentions in a cohabitation agreement

Two unmarried people who are cohabiting, or who intend to cohabit, may make a cohabitation agreement about their rights and obligations, including property and support. It is unenforceable unless it is in writing, signed by the parties and witnessed.

Ontario's guidance says each partner should speak to a different lawyer and that you should exchange financial information before signing. This matters because a court may set aside a contract if a party failed to disclose significant assets, debts or other liabilities, or did not understand its nature or consequences.

Some limits apply. An agreement cannot deal with decision-making responsibility or parenting time, and a court may disregard a child support term that is unreasonable. If you later marry each other, the agreement is deemed to be a marriage contract.

Shared debts and what to do before closing

Owning together can mean borrowing together. Joint bank account holders share responsibility for all transactions, and an overdraft may create a debt for everyone on the account. Co-borrowers on a joint credit card are equally responsible for the balance, while an additional cardholder is not responsible for repaying it. Your responsibility for a debt generally depends on the contract you sign.

• Decide between joint tenancy and tenancy in common, and tell your lawyer why.
• Agree on how the deposit and later contributions will be treated if you separate.
• Keep records of every payment toward the purchase.
• Arrange separate lawyers for a cohabitation agreement and exchange financial information first.
• Make or update your wills so the home passes the way you intend.
• Review who is on each mortgage, account and card before you sign.

Frequently asked questions