Buying a Home With Family or Friends in Ontario: Ownership, Contributions and Exit Terms

Before buying an Ontario home with family or friends, agree on how you will hold title, what each person will pay, and what happens if someone wants out. Title records ownership. Mortgage documents set out what the lender can require from each borrower. A co-ownership agreement explains what the buyers owe to each other.

This guide is for individuals buying a home together. If you have an offer in front of you, also review what Ontario buyers should check in an agreement of purchase and sale.

If you have an offer deadline, a financing condition date or a closing date, include it in your inquiry. We check conflicts and availability and explain the consultation scope and any fee before you book. An inquiry does not retain the firm or confirm that we can meet a deadline.

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How should you hold title together?

Joint tenants: If the joint tenancy is still in place when one owner dies, the surviving joint tenant or tenants generally take the deceased owner’s interest by right of survivorship. A will alone may not accomplish a different plan for the jointly held property.

Tenants in common: Each owner holds a separate share in the property as a whole, rather than owning a particular room or floor. Shares can be equal or unequal. When one owner dies, that person’s share generally forms part of their estate.

Ask how the title should reflect the arrangement you actually intend, especially if one buyer will contribute more or expects their share to go to someone other than the other co-owner. The title documents, the co-ownership agreement and each owner’s estate plans should be considered together.

How will you share the down payment and ongoing costs?

A larger down payment can mean different things. One buyer may want a larger ownership share, expect repayment before the remaining sale proceeds are divided, or intend to give money without expecting repayment. Record what each contribution means. The lender may also have requirements for documenting a gift or loan.

Agree on who will cover the deposit, land transfer tax and other closing costs, and how those payments count toward each buyer’s contribution.

Decide separately how to share mortgage payments, property taxes, insurance, utilities and repairs. The split for monthly expenses can differ from the ownership split. Discuss how to record additional contributions and what happens if one owner pays a bill the others were supposed to share.

What can the lender require from each borrower?

Your agreement can divide payments between you. The lender’s rights come from the mortgage and loan documents. If you sign as borrowers with joint and several liability, the lender can seek the full unpaid amount from any of you, subject to those documents and applicable law. A guarantor’s obligations depend on the guarantee they sign.

What should a co-ownership agreement cover?

Put the ownership and payment decisions in writing. A useful agreement also deals with situations that can cause disagreement after closing:

• Use of the home: Who can live there, how private and shared space is used, and whether renting any part requires consent.
• Decisions and expenses: Who can approve major repairs, renovations or new spending, and how owners resolve a deadlock.
• Missed payments: What notice is required, how a shortfall is handled and how one owner’s extra payments are recorded.
• Changes in ownership: How an owner can request a buyout or sale, and how disputes about those terms will be addressed.

Review the agreement alongside the title and lender documents. An agreement between buyers does not change the seller’s obligations under the purchase contract or bind a lender that has not agreed to it.

What happens if one person wants out?

Discuss how much notice an owner must give, whether the others have the first opportunity to buy their share, and how you will determine a price. A buyout calculation can raise questions about the mortgage balance, closing costs and contributions that one owner expects to recover. Agree on what happens if the proposed buyout falls through, including whether the home would be listed for sale.

A transfer on title does not remove a borrower from the loan. If the remaining owners plan to keep the home, find out whether the lender will release the departing borrower or whether the mortgage must be repaid or replaced. Also review any transfer costs or tax consequences before relying on a buyout figure.

If co-owners cannot agree, Ontario’s Partition Act can provide a way to ask a court to divide or sell the property. Whether that remedy is available and what a court might order depend on the ownership interests, agreements and circumstances.

Could family or estate changes affect the plan?

If the property is a matrimonial home under Ontario’s Family Law Act, a married spouse may have possession rights even if they are not on title. The Act can also restrict a sale or mortgage of an interest in the home. A planned transfer or buyout may need review if a spouse’s rights are involved.

Think through what the remaining owners would want to happen if someone dies. For example, if a share is to pass through an owner’s estate, discuss whether the other owners can buy that share and how the estate would be paid. Review this together with the form of title and the owners’ estate plans.

How can Legal Route help before you commit?

We can review a proposed purchase agreement, discuss title and financing terms, and identify issues that a co-ownership agreement should address. Advice on the proposed arrangement is a different scope from acting on the closing. We confirm who we can represent and what work we can take on before an engagement begins.

Legal Route’s legal services are provided by lawyers licensed by the Law Society of Ontario.

Real estate consultations in Brampton and across Ontario

In person in Brampton. Appointments are available by arrangement at our Brampton office, 2074 Steeles Avenue East, Unit 17.

Toronto and the GTA. We assist clients in Toronto and across Peel, York, Halton and Durham, including Mississauga, Vaughan, Oakville and Oshawa.

Virtual appointments across Ontario. Virtual appointments are available for suitable real estate matters, including for people in Hamilton, London and Ottawa. We confirm signing, identification and document requirements for your purchase. See our Ontario service areas.

Frequently asked questions about buying a home together

Does a larger down payment automatically give me a bigger share?

No. Paying more does not by itself change registered title. The intended ownership shares and how additional contributions will be treated should be addressed in the documents.

Can a parent help with the mortgage without owning part of the home?

That depends on what the lender permits and what the parent signs. Being on title, signing as a joint borrower and giving a guarantee are different commitments. Ask whether the lender requires the parent to be on title or only to sign financing documents, and have those terms reviewed.

What if only one buyer qualifies for Ontario’s first-time homebuyer refund?

The Ontario land transfer tax refund can be reduced when only some buyers qualify. The interest each eligible buyer acquires and the applicable spouse rules can affect the result. Confirm eligibility before budgeting for a refund.

Can all co-buyers use one lawyer?

It depends on the parties’ interests and the work involved. A lawyer considering a joint retainer must explain how it works and obtain the required consent. Separate advice may be needed where, for example, buyers are negotiating unequal contributions or one is giving a guarantee.

Can we make a co-ownership agreement after signing the purchase offer?

It may still be possible. The agreement between co-buyers does not change a signed purchase contract or extend its deadlines. Have the signed documents and dates reviewed so you know what can still be addressed before closing.

Related Legal Route resources

• Buying a home or investment property
• What to review before signing a purchase agreement

Official resources

• Ontario’s guide to co-owning a home
• Financial Consumer Agency of Canada: Joint borrowing
• Ontario’s Partition Act
• Ontario’s Family Law Act
• Ontario: Land transfer tax refunds for first-time homebuyers

This article provides general Ontario legal information. Your rights and options depend on your purchase, title and financing documents, any agreements, and your circumstances.