DIVORCE – Keep Your Home In Spite Of Your Income And Credit

 

We do not personally offer any mortgage or real estate service. If we can find a solution for you to keep your home, it will be carried out by one or more members of the team of licensed professionals and investors that we rely on to help you. RTO Partners is not a licensed real estate agent or lender. We do not lend money or buy property.

Our strategy is a potential solution for the property division problems that hit virtually all home-owning couples who divorce or separate. If you thought you couldn’t avoid losing your house in divorce, you may be wrong. There is hope.

We offer a flexible and innovative method that goes beyond “property division”. We can help to completely divide both spouses’ financial interests in the house. It can be effective for working parents, empty-nesters and stay-at-home single moms and dads – or anyone else going through divorce. It’s a HUGE relief to anyone who hates the idea of having to move because of divorce.

Family law professionals (divorce lawyers, judges, family law practitioners) also see tremendous value here for making spousal property division faster and simpler.

With this strategy, the matrimonial home’s equity is FULLY liquidated into cash because the house is sold to an investor. The money is then split according to the couple’s agreement, and one spouse remains in the house (with their children if applicable) for 3 to 5 years before buying it back (by renting the house back on a rent to own system). To accomplish this, the couple or spouse will generally need to have 17% or more equity in their home. Even if the house is owned outright, this system may be very useful, because it ends all financial ties between spouses where the marital house is concerned.

A portion of the stay-behind spouse’s share of the liquidated home equity is used to make a down payment (“purchase option credit”) towards buying the house back, and (if possible) prepay from 6 to 24 months rent. This purchase credit is not refundable if you cannot or do not purchase the property at the end of your rent to own lease. Prepaying rent makes the deal more attractive to buyers, who will be more likely to agree to pay full market value, and gives the “stay behind” spouse a period of time without any house payments to get their finances back on track, seek work, adjust to life after divorce, establish new routines, and live with less financial pressure.

As we know, in some cases a spouse may have trouble getting their own mortgage if they cannot find a lender who agrees to consider their spousal support to be income AND will agree to a reasonable (affordable) interest rate.

Liquidating the home equity is a fantastic problem solver:

  • completely remove mutual financial interest in the matrimonial home
  • stop the constant fighting about the money
  • avoid the financial and personal devastation of foreclosure caused by divorce or separation
  • don’t lose the house because spousal support payments (alimony) are not considered as “income” by most lenders
  • if you are the spouse with the lowest income, you don’t have to be hit the hardest
  • the spouse remaining in the house will not be put in a position of ignoring a judge’s order to refinance the mortgage in their own name – because of inertia or a justifiable fear of not being able to qualify – which may painfully drag the couple back together to deal with a lender or the courts
  • avoid foreclosure happening within a couple of years AFTER divorce due to financial strain, greatly reducing any remaining goodwill between spouses and further impacting children
  • it provides cash to afford the added post-separation costs of both spouses (there are now 2 housing payments per month, 2 utility, cable and energy bills per month, and so on)

The DLYH method provides both spouses, judges, divorce lawyers
and family law professionals with a very flexible and powerful tool
to resolve difficult property division issues in divorce.

Visit our HOME PAGE to fill out an application and help us try to find a solution for you.



Resources

PDF FILE – Legal resources, information, and referral services for service providers and families who need information about family law and courts in Ontario

Family Law section of Attorney General website

Ontario Family Law Blog

Ontario Association Of Family Mediators

The “Divorce Happens” blog