If a co-owner is being bought out, what is their responsibility regading refinance fees?
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If a co-owner is being bought out, what is their responsibility regading refinance fees?
My mom entered into a living situation where she and another family bought a home. It’s now time for her to move out. They want to refinance the house into their name. Not sell the house (refinance being the key here). They want to charge 6.5% in realtor fees in order to do this; 1/3 of this would be my mom’s responsibility for $13,000 in total. This would be deducted from the equity of the home. They say that this would be a normal expense to my mom if or when they were to sell the home in the future. That this is normal business protocol in these situations. I have been arguing that she should not have to pay for a sale of a home when they are only going to refinance the home into their name.
Asked on January 8, 2013 under Real Estate Law, California
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
I agree with you. If the situation is where your mother is being bought out and she is going to deed over her interest in exchange for payment of money and the property is solely going to be refinanced, there is no legal right for any one to mandate that your mother pay any semblance of real estate commissions for a refinance where there is no sale and she is being bought out of the property.
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