When most people pass on, the most expensive item of their estate comes in the form of the family home. As such, they may think that the best idea is to leave that family home to split among their beneficiaries. They may believe that children will sell the home and split the proceeds, but that plan doesn’t always go according to plan.
Many people form precious memories to places, and especially when a loved one passes away, they may try to keep grasp of those memories. So if you have inherited a home with a sibling, you may find that they don’t want to sell. What options does that leave you with?
Be Bought Out
If the house has been left to multiple people and one party does not want to sell, they have the option of buying you out. This can be done by financing your share of the house via a third party mortgage or the siblings can conduct a private buyout.
If you do not have the best relationship with your siblings, a third party mortgage will be the safest route to go. However, if the sibling that wants to keep the home cannot qualify for a mortgage, be sure to get a legally binding promissory note stating that they will pay you so much a month until they pay back your stake in the house. Even with family, it is never safe to take someone at their word.
If a sibling doesn’t want to sell a property, there is the possibility of you working together to create a rental property out of it. This way, both parties retain ownership and also make a monthly profit off the property. It can also be agreed that times can be set off where rental is not available so that interested family members can use it as well.
If you and your sibling cannot agree on what to do with a home you both inherited, you can have the court intervene by filing a suit for partition. In this procedure, the court can force sale to dissolve the co-ownership of a house. Unfortunately, there a number of individuals involved in this, such as referees to act as an intermediary between the siblings, brokers, and even possibly accountants that will all have a fee. This intervention drastically reduces any profits from the sale of a home and it should be used as a last measure.
If you have recently inherited a home and find yourself in a contentious situation with your siblings, or have any other estate issues, contact us today.