Board Thread:Questions and Answers/@comment-90.176.7.225-20140520182401/@comment-1221309-20160111222400

I always thought that there was a heaven that they would all go to once they had accepted their fates and come to terms with what had happened to them, then, after some time, they would leave this heaven, lose all their memories as they made their way back to Earth to be reincarnated. So, Otonashi died and went straight to this heaven and spent a number of years there. While he was there, Kanade had the heart transplant, lived a long life and died with the regret from her high school years that she never got to thank the person who gave her her new heart.

Some time later, as all spirits eventually do, Otonashi left behind heaven and his memories and set out to go back to Earth, however, he was involved in the regret of Kanade, so, along the way, his spirit got misled as spirits going into heaven on the same route normally do, to a place where he could resolve the issue involving him. His spirit is set to go to Earth after he leaves the high school, but, it might be difficult for him leave because, although the issue that tied him there was solved, it wasn't actually his issue that got resolved. Some years later, he finally manages to leave, all the while Kanade has been in heaven and has decided to go back to Earth, allowing them to reincarnate around the same time and meet on the street as we see in the final seconds of the show.

That's how I've spent the last few years rationalising that to myself, feel free to point out any holes, I've shared this with 2 other people who have yet to come back to me with any gapping holes in my theory.