The client
A separating couple in Riviere-du-Loup believed a written agreement drafted years earlier by a lawyer, and signed by both of them, had opted their $370,000 home -- close to the Canadian average home price -- out of any shared regime, until the notary handling the buyout confirmed it had never had that effect at all.
Home value
$370,000, Riviere-du-Loup
Existing mortgage balance
$180,000
Home equity
$190,000
Departing spouse's acquest share
$95,000
50% of the equity, under the default regime
The problem
Quebec's Civil Code does not treat a marriage contract the way most other provinces treat a domestic contract. Article 440 requires it to be made by notarial act en minute -- on pain of absolute nullity. A private agreement, however clearly both spouses intended it and however carefully a lawyer drafted it, is simply not a valid marriage contract without that form.
What the couple's document actually was
- ▸It was signed by both spouses and witnessed, but drafted and executed privately -- never made before a notary, and never registered in the Register of Personal and Movable Real Rights
- ▸Article 440's requirement is absolute: there is no lesser or substitute form that satisfies it
- ▸Because no valid marriage contract existed, the couple had been married under the default partnership of acquests the entire time, whatever they believed
The buyout could not be priced on the assumption the home was excluded from any shared regime. It had to be repriced on the acquest each spouse was actually entitled to.
The numbers
Once the default regime was confirmed to apply, sizing the buyout refinance was ordinary arithmetic.
| Repricing the buyout under the default regime | Amount |
|---|---|
| Home equity | $190,000 |
| Departing spouse's acquest share (50%) | $95,000 |
| New mortgage balance | $275,000 |
| Total debt service, keeping spouse's own income | Figure |
|---|---|
| Payment at the qualifying rate (6.65%), 25 years | $1,867/mo |
| Property tax | $240/mo |
| Heat (lender estimate) | $100/mo |
| Car loan | $210/mo |
| Total debt service | 35.5% |
35.5% clears comfortably on the keeping spouse's own income — the arithmetic itself was never in question. Confirming which regime actually governed the marriage was.
The solution
A courtier hypothécaire licensed under Quebec's Act respecting the distribution of financial products and services treated the marriage contract's validity as a threshold question for the family's own notary, not an assumption to build the file around.
First, asked to see the marriage contract itself, not a description of what it said. A document that was never executed before a notary is a red flag regardless of how confidently either spouse describes its effect.
Second, had the notary confirm in writing that the private agreement was absolutely null under article 440, and that no notarial marriage contract had ever been registered against this marriage.
Third, repriced the buyout under the partnership of acquests -- the default regime that had, in fact, governed the marriage the entire time -- rather than the $0 claim the couple had assumed.
The outcome
The buyout refinance funded at 4.65% against the correctly-priced $95,000 acquest share, with total debt service at 35.5%.
Because this is an uninsured refinance, CMHC's ratio maximums do not apply directly; the 35.5% figure is informational.
What to take from this file
- 01A Quebec marriage contract must be a notarial act, on pain of absolute nullity. A private, lawyer-drafted agreement -- however deliberate -- does not satisfy article 440.
- 02Ask to see the document itself, not a summary of it. Whether it was executed before a notary is the one fact that decides everything else.
- 03Without a valid marriage contract, the default partnership of acquests governs. Assume nothing about which regime applies until a notary confirms it.
- 04Pricing a buyout on the wrong regime can be the difference between a $0 claim and tens of thousands of dollars. Confirm the regime before sizing the refinance, not after.
Sources
Every regulatory figure in this file traces to one of these primary sources. Client details and anything that varies by lender are illustrative, as flagged below.
- ▸OSFI — Minimum qualifying rate for uninsured mortgages — the minimum qualifying rate — greater of contract rate + 2% or 5.25%.
- ▸Provincial/territorial mortgage-broker legislation fetched directly (bclaws.gov.bc.ca, legisquebec.gouv.qc.ca, fcaa.gov.sk.ca, web2.gov.mb.ca, nslegislature.ca, assembly.nl.ca) plus FCNB's own site for NB and CanLII's index for PE — see notes for per-province method — provincial mortgage regulators and licence titles.
Illustrative in this file — lender-specific, not rules:
- ▸4.65% contract rate — rates move daily; not a quote.
- ▸the TDS figure — this is an uninsured refinance, so there is no CMHC ratio ceiling -- the number is informational.
Authority & provenance
How this case file was built
We publish the origin, the verification method and the reviewer for every case file, so you can judge how far to trust it before you rely on it with a client.
Where it comes from
Derived from files handled by Treadstone’s fulfillment desk and from scenarios contributed by partner brokerages. Names, employers, exact amounts and dates are changed so no client or file is identifiable.
Provenance: Composite — a pattern seen repeatedly on fulfilled files, not a single transaction.
What is verified
Every regulatory figure traces to a primary source listed above and was checked against it on the date shown. The arithmetic is recomputed by machine on every rebuild.
Anything that varies by lender is labelled illustrative rather than stated as a rule.
Who reviewed it
Reviewed for Canadian regulatory accuracy before publication, and re-checked whenever a cited rule changes.
Reviewed by: Nicholas Parson, Treadstone Associates — reviews every case file before publication.
This case file is professional reference material for licensed mortgage professionals. It is not advice to a borrower, and it is not a lender commitment. Insurer rules, qualifying rates and provincial taxes change — confirm the current position with the insurer, regulator or lender before you rely on any figure here in a live file.