Markham Families: How to Protect Your Property and Wealth During Marriage, Divorce, or Inheritance

Markham Families: How to Protect Your Property and Wealth During Marriage, Divorce, or Inheritance

Markham, known for its vibrant and growing Chinese community, is a city where family ties run deep and supporting the next generation, especially with real estate is often part of tradition. But in a changing housing market and legal environment, how can families protect their hard-earned assets while still helping children thrive?

Why Many Chinese Families Avoid Prenups (But Shouldn’t)

In the Chinese community, talking about prenuptial agreements often feels awkward or even taboo. Many view it as a sign of distrust, fearing it may offend the other party or their family, especially during an otherwise happy engagement.

But here’s the reality in Ontario:

• Even if a home is bought before marriage, it may be subject to division if it becomes the family home.
• Without a prenup, the law decides how your wealth is split and it may not reflect your values or intentions.

More young couples in Canada are now choosing marriage contracts (prenups), not because they expect divorce, but because they want clarity and fairness, especially when one partner has significantly more assets.

Prenups protect love and money. Talking openly when the relationship is good is much easier than battling it out when things fall apart.

How Asset Division Works in Ontario: A Clearer Explanation with Examples

In Ontario, when a legally married couple divorces, the law uses a system called "equalization of net family property." Here's how it works step by step:

Step 1: Determine the Value of Assets and Debts at Two Points in Time

• On the date of marriage
• On the date of separation (not the divorce date)

Each spouse calculates:

Net Worth = Total Assets - Debts

Step 2: Subtract Marriage-Day Net Worth from Separation-Day Net Worth

This gives the net increase in wealth during the marriage.

Step 3: Compare Both Spouses’ Net Increases

The spouse with the higher increase pays half the difference to the other spouse. This is called the equalization payment.

Example 1: Equalization in Action

Difference in net increase: $500,000 - $150,000 = $350,000
Spouse A must pay Spouse B: $350,000 ÷ 2 = $175,000

Example 2: One Spouse Has Debt

Spouse B's increase is treated as $0, not negative.

Difference: $300,000 - $0 = $300,000
Spouse A pays Spouse B: $150,000

Spouse A is not responsible for B's debts, and B cannot claim extra just because of debt.

Protecting Parents Who Help Kids Buy Property

Many Parents in Markham play a big role in helping their children buy homes, whether it’s offering a down payment, co-signing a mortgage, or even paying for the property outright. In many cases, this support comes from a genuine desire to leave behind assets for the next generation.

But one of the most frequently asked questions I get from Chinese families is:

“What if my child gets married and then divorced? Will our family’s money be split?”

It’s a real and valid concern, especially under Ontario’s family law system, which automatically splits the growth in wealth during marriage, including the family home.

Advisable Strategy for Parents:

 Buy the home under the parent’s name
 This keeps the property outside the marital asset pool.

Have the child pay rent
 This makes it a rental arrangement, not a “gift.”

Parents should cover all major home costs
 Including the mortgage, property tax, insurance, and ideally even renovations.

Keep detailed written records
 Paper trails matter: document all payments, ownership, and agreements.

This setup avoids the home being considered a “matrimonial home”, which in Ontario gives both spouses equal rights to the home, even if only one name is on title.

Here is recommended:

Ask your child to sign a marriage contract (prenuptial agreement) that clearly states the home remains the parent’s asset, or that any family contributions are not to be shared in a divorce.

We understand that in Chinese culture, bringing up a prenup may feel awkward or “unromantic.” Some fear it sends a message of distrust. But as more parents start thinking ahead, protecting family wealth is becoming part of responsible planning—not pessimism.

What About Common-Law Couples?

In Ontario, common-law couples (living together 3+ years or having a child together) do not have the same property rights as married spouses. There’s no automatic right to:

• Share in property appreciation
• Stay in the matrimonial home
• Receive inheritance or pension division

Unless both names are on the title, you may walk away with nothing.

Solution: Sign a cohabitation agreement (similar to a prenup) outlining how assets will be treated if the relationship ends.

Thinking About Buying a Foreclosure or Auction Property?

Foreclosure properties in Markham may seem like a deal but they come with risks:

• The original owner can reclaim the property before closing by paying off the debt.
• Outstanding taxes or utility bills may need to be paid before transfer.
• If the property has tenants, you inherit their tenancy rights.
• Legal challenges can arise if the auction process is deemed unfair.

Tip: Work closely with an experienced real estate lawyer to perform due diligence and ensure you’re not buying a hidden liability.

Final Thought: Don’t Let Emotions Undermine Generational Wealth

In the Chinese community, we often prioritize harmony and avoid legal conversations. But silence can lead to financial loss and family tension later on.

Love needs trust, but wealth needs protection.

Whether you're entering a marriage, helping your children buy a home, or buying investment properties, take the time to:

• Talk to a lawyer
• Sign the right agreements
• Protect the effort and savings that took decades to build

If you’d like help drafting a prenuptial or cohabitation agreement, reviewing property titles, or navigating a foreclosure, consult with a licensed lawyer familiar with Ontario’s family and real estate law.

• 183 Willowdale Ave
  Toronto, ON, M2N 4Y9, Canada
• 647-877-9311
• alan@mycanadahome.ca
• www.mycanadahome.com