"Dean’s saying he and Lily are in love and ready for the next step," a source spilled to a news publication while revealing the exciting news.
"She’s been amazingly supportive of his journey to sobriety, and they’re spending so much time together, it just made sense for him to move in," the insider added of Calo and McDermott – whose struggles with substance abuse ultimately led to his and Spelling's marital demise.
McDermott and Spelling share five kids, Liam, 16, Stella, 15, Hattie, 12, Finn, 11, and Beau, 6, which was why the 57-year-old allegedly made sure to inform his estranged wife he'd be moving in with his new girlfriend.
According to the insider, the Beverly Hills, 90210 actress — who since the split, has been living out of motels and RVs with their children — didn't have much to say.
"It was like, whatever makes you happy. Tori has moved on too," the confidante confessed of Spelling, 50, who was romantically linked to Ryan Cramer in November 2023.
As OK! previously reported, Spelling and McDermott's relationship came to an end last year when the reality stars announced they were calling it quits on their marriage after nearly two decades together.
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"It's with great sadness and a very very heavy heart that after 18 years together and 5 amazing children, that @torispelling and I have decided to go our separate ways, and start a new journey of our own," the Open Range actor expressed in a later-deleted statement shared to Instagram.
His message continued: "We will continue to work together as loving parents and guide and love our children through this difficult time. We ask that you all respect our privacy as we take this time to surround our family with love and work our way through this. Thank you all for your support and kindness 🙏."
While some social media users were shocked to hear the news, others were far from surprised, as previous reports revealed their marriage was on the rocks in the years leading up to them parting ways.
In 2021, a source confessed the then-couple wasn't even sleeping in the same bed.
"Tori and Dean do things as a family for the sake of their kids and live in the same house but sleep in separate rooms," the insider dished at the time.
Star spoke to a source about McDermott moving in with Calo.