Spousal Buyout Program

“Until death do we part…”   doesn’t always happen. Divorce is never easy, especially if you own a matrimonial home together. If you or your spouse is looking to stay in the home after you have separated, there is a program available. The Spousal Buyout Program will allow a spouse to be bought off title in the event of a marital split, allowing you to take up to 95% of the equity out of the house.


Under the regular mortgage refinance rules, you are only allowed to refinance up to 80% of the property’s value. Unfortunately this leaves 20% of the equity still tied up in the house and normally the only way to access that equity would be to sell the property. However this can be time consuming, disruptive and stressful. Getting divorced or separating from a loved is difficult.


Is one spouse hoping to stay in the existing home?


The spousal buyout program falls under the mortgage purchase rule and allows you to finance up to 95% of your home’s value. With this you may be able to keep your home without moving, while paying your ex-spouse or partner their portion of the home’s equity and help with maintaining some stability with family life.


In order to qualify for the spousal buyout program, you must have good credit and you must be able to afford the mortgage on your sole income. You must also have a legal Separation Agreement and a Purchase Agreement that has been prepared by your lawyers. Lastly you and your ex-spouse or partner must currently be on the deed to the property.

Using this, you would be able to keep your home and avoid moving and have a little bit of stability in a somewhat turbulent time.


Lastly, if your spouse is buying out your equity in the matrimonial home, always make sure to get a confirmation from the lender in writing that you are no longer registered on the mortgage. Just know that simply being taken off the property’s title is not the same thing. Until you can provide written proof of this, you could still be on the hook for the outstanding mortgage balance for a house you no longer own.


Going through a divorce is often unpleasant, and at times can be quite expensive. Getting some good mortgage advice can help you save some money in the long run. That is why seeking the advice from a mortgage professional like myself. I can help you set the stage for a successful separation. So, the two of you can have the best possible new start.