What happens is a co-owner of a house wants to be bought out of their share?
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What happens is a co-owner of a house wants to be bought out of their share?
My grandfather passed 3 years ago. While he was still living I urged my mother and aunt to remove his name off the house and place it into theirs because probate is long, expensive and you can run the risk of losing your property. Fast forward 3 years, now my aunt is harassing my mother to “take her name off the house” and buy her out (which she quoted $95,000 but the house is not worth that amount). My parents moved out their home to be my grandpa’s sole caregiver, they paid all his medical and household bills and $1,800 a year property tax off their fixed income. This while my aunt, who grosses $10,000 a month, pays nothing. She didn’t even help with funeral expenses.
Asked on July 16, 2014 under Real Estate Law, California
Answers:
M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney
Answered 9 years ago | Contributor
When 2 co-owners of real estate (or personal property) cannot agree on its use or disposition, there is a legal remedy available to them. It is called "partition". In an action for partition, the court will determine if the asset in question is capable of being divided. If, as a practical matter it is not (such as in the case of a single-family dwelling), then a sale will be ordered. The property will be put on the market at fair market value and, once sold, the proceeds will be equitably distributed. However, before a sale to a third-party takes place, the judge will allow any co-owner who wants to retain the property, to buy out the remaining co-owner (again at FMV for their share). Addionally, since the sale proceeds are to be "equitably" divided, the court may allow for your parent's to recoup any expenses over and above their share that they paid out on the property.
However, a partition action can be time-consuming and costly. At this point, your parents should consult with a real estate attorney in the area of where the house is located for further advise.
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