Separated But Still on the Mortgage? Here's What You Can and Can't Do in Alberta

Written By Renee Huse

Renee Huse, founder of Spire Mortgage Team in Alberta, understands that separation is not just a legal and financial event—it’s an emotional journey. When your relationship ends but your mortgage obligations continue, the path forward can seem overwhelming. This guide aims to provide you with a clear, compassionate, and comprehensive understanding of your options and responsibilities in Alberta.

What We'll Cover:

Understanding the Intersection of Separation and Mortgage Obligations in Alberta

In Alberta, when a couple separates, the mortgage does not automatically adjust to reflect the change in relationship status. Both parties remain legally responsible for the mortgage payments until the debt is fully paid off, refinanced, or the property is sold. This joint liability persists regardless of who resides in the home or who is making the payments.

Key Points:

  • Joint Responsibility: Both names on the mortgage mean both individuals are fully responsible for the entire debt.
  • Credit Implications: Missed payments affect both parties’ credit scores.
  • Legal vs. Lender Agreements: A separation agreement does not change your obligations to the lender.

Under Alberta's Family Property Act, the division of property, including the matrimonial home, is subject to equitable distribution. This means the property is divided fairly, though not necessarily equally.

Options Include:

  • Mutual Agreement: Both parties agree on the division of property.
  • Court Intervention: If no agreement is reached, the court may order a sale or buyout.

Always consult with a lawyer familiar with Alberta family law.

Here’s the truth: when a relationship ends, the financial clean-up is often way messier than anyone expects — especially if you’re still tied together through a mortgage. Whether you want to stay in the home, buy your ex out, or just walk away clean, you need to know what’s possible. Let’s walk through the three main paths we guide our Alberta clients through all the time.

1. Refinancing the Mortgage

This is often the first option people ask about — and for good reason. Refinancing means you take the current mortgage, pay it out completely, and replace it with a new one in your name only. It’s the clearest way to untangle things.

You can typically borrow up to 80% of your home’s current appraised value, so there needs to be enough equity in the property to make this work — especially if you're planning to pay your ex a lump sum as part of the agreement.

We had one client in Calgary, a teacher, who came to us thinking she had no shot. But once we ran the numbers, her salary, child support, and her stellar credit got her qualified solo. It took a bit of paperwork, and a lot of late-night wine-fueled spreadsheet sessions, but she made it work — and now, she says walking into that house feels like hers again.

What you’ll need:

  • Proof of income
  • Good credit (ideally 680+ for the best rates)
  • A recent appraisal or valuation
  • A separation agreement if the lender asks for it

This is a good fit if there’s enough equity to work with and you’re ready to stand on your own financially.

2. Spousal Buyout Mortgage

Now, this is where it gets interesting — and where a lot of people don’t know they have options. A spousal buyout mortgage is a very specific program, built just for situations like yours. It allows one partner to stay in the home and pay the other out — even if you don’t have 20% equity.

With this, you can borrow up to 95% of your home’s value. But here’s the catch — that extra 15%? It has to go directly toward paying out your ex. You can’t use it to renovate or consolidate debt. It’s strictly for equity transfer.

We had a client in Red Deer who was about to walk away from her home because a traditional refinance couldn’t give her enough to buy out her ex. We switched strategies and used the spousal buyout program. With a formal agreement, an appraisal, and proof of income, she stayed put, bought him out, and avoided uprooting her kids.

She told me, “I thought it was over. I didn’t think I had options. But that one product changed everything.”

You’ll need:

  • A signed separation agreement
  • A full appraisal
  • Documentation of income (yes, child support counts if it's formal and consistent)

This route can feel like a lifeline when you want to stay but don’t have enough equity for a conventional refinance.

3. Selling the Property

Sometimes, the cleanest move — emotionally and financially — is to sell. I say this to a lot of people who are trying to hold on out of guilt, fear, or pressure. But if the home is a financial stretch on your own, or you’re both at a standoff? Selling can be the reset button.

When you sell, the mortgage gets paid out, and whatever is left over (after realtor fees, legal costs, and potential penalties) gets split as outlined in your separation agreement. It’s a fresh start. And honestly? Sometimes it’s the only route that keeps both parties sane.

One couple I worked with in Grande Prairie couldn’t agree on who should keep the house — and the standoff was costing them emotionally and financially. Once we modeled the outcome of a sale, they both saw it gave them breathing room. They each bought smaller, more manageable homes, and later told me it was the best decision they could’ve made.

What to consider:

  • Is the home realistically affordable on one income?
  • Will the proceeds help or hurt your next step?
  • Do you have a realtor and mortgage broker working together on the timeline and math?

If you’re even thinking about this option, run the numbers. Don’t assume you’ll walk away with what your neighbor did — Alberta’s real estate market varies wildly between Calgary, Edmonton, and smaller cities.

Emotional Considerations: Navigating the Transition

Let’s not sugarcoat it—separation is emotionally exhausting. It’s not just about legal documents or who pays what. It’s the quiet moments, the unraveling of routines, and the raw fear of not knowing what’s next. We see this every day with our Alberta clients, and we want you to know: you are not alone, and how you feel is valid.

This isn’t just a financial transaction—it’s a life shift. And the way you handle the emotional side of this transition will shape how you come out the other side. That’s why part of our job isn’t just mortgage strategy. It’s helping you feel grounded, even when everything else feels like it’s shifting under your feet.

Here are a few ways to take care of yourself while you're making these big decisions:

  • Talk to someone you trust—regularly. Whether it’s a counselor, coach, or a close friend, processing what you’re going through out loud can help you move through it, not just survive it.
  • Keep communication respectful—when possible. Not every separation is civil. But when you can keep the temperature down, it often speeds up resolution. Think of communication like a tool: use it to get to the finish line, not to rehash old wounds.
  • Stay anchored in your long-term vision. It’s easy to get stuck in today’s stress—court documents, custody talks, missed emails. But zoom out. What do you want 12 months from now? Stable housing. A rebuilt credit score. A clean slate. Focus there.

One client from Lethbridge told me, “The mortgage stuff was actually the easiest part—because it gave me something I could control.” That stuck with me. Your emotional health and your financial decisions are linked. If we can get you one step closer to clarity, that’s a win we’ll take every time.

Case Study: Lisa’s Journey to Financial Independence in Airdrie

Background: Lisa, a 38-year-old mom from Airdrie, shared a home and $420,000 mortgage with her ex. Post-separation, she moved out thinking signing off the title was enough. It wasn’t—her credit dropped, and she couldn’t qualify for a new mortgage.

Solution: We helped her use a spousal buyout mortgage at 3.99% (insured). The home appraised at $500,000, and she borrowed $475,000 to pay out her ex, cover legal costs, and refinance solely under her name. She qualified using her income plus child support.

Outcome: Lisa owns the home, her kids have housing stability, and she’s financially independent.

Glossary of Terms

  • Spousal Buyout: A mortgage product allowing one partner to buy out the other after separation.
  • Refinancing: Replacing an old mortgage with a new one, often under one name only.
  • Equity: The home’s market value minus what you owe on the mortgage.
  • Appraisal: An independent valuation required to support a refinance or buyout.
  • Separation Agreement: A legal document outlining the terms of your property and financial split.

Frequently Asked Questions

Can I remove my ex-spouse’s name from the mortgage without refinancing?

No. A lender must approve a refinance under your name only.

Can I use child support to qualify for a mortgage?

Yes, if it’s legally documented and consistently received over 3–6 months.

What if I can’t afford to buy my ex out?

You may need to sell or work out a co-ownership agreement until your situation improves.

Will the old mortgage affect my ability to buy a new home?

Yes, unless you’re legally released from liability or have offsetting agreements recognized by the lender.

Take the First Step Toward Clarity

Give us a call or fill out an application at this link and our team will get in touch with you to start building a plan that suits you.

Renee Huse
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