By NicoleReed / June 7, 2022
Inheriting real estate with other people can be challenging, particularly when one of the beneficiaries is living in the house. This scenario commonly occurs when siblings jointly inherit their parent’s home, which can lead to increased family tensions during an already emotional time.
It is always preferable for siblings to work out an arrangement that all of the beneficiaries agree with, such as a buyout agreement. However, under California law, if the siblings can’t agree any of the siblings want to sell the house they inherited, they can use a legal proceeding known as a “partition action” to force the sale.
What Happens When One Sibling Lives In an Inherited Property and Refuses to Sell?
When one sibling lives in an inherited property and refuses to sell when the other siblings want to, there are several options for solving the dispute. For example, if the sibling living in the home has the financial means to do so, they could buy out the other siblings’ shares of the property.
However, if the beneficiaries cannot agree on how to handle the situation, the siblings who want to sell can force its sale through a partition action. A partition action is a legal proceeding that allows a co-owner of a property to get a court order either (1) to sell the property; or (2) dividing the property into separate parcels for each owner, if possible. But since residential homes can rarely be apportioned like this, the most common outcome in these situations is that the court orders the property to be sold and the proceeds to be divided among all co-owners – importantly after the petitioning party’s fees and costs are paid.
This means that the siblings that want to sell an inherited property can typically force its sale, even over the objections of the sibling who lives in and wants to keep the home.
Can I Buy Out My Siblings From an Inherited House?
Yes, if you and your siblings inherit a house together, you can buy them out if all siblings agree.
Even if your siblings have already filed a partition action, there is still time to reach a settlement agreement. The fact that a partition action has been initiated does not mean that the forced sale of the inherited house is inevitable, as long as you and your siblings can come to an agreement. The most common settlement scenario is where the sibling who wants to keep the house buys out the siblings who want to sell it.
If this is not a possibility, siblings can pursue alternative arrangements such as renting the property to the sibling living there or allowing the sibling to keep the home in exchange for their share of other estate property. In some situations, it may be acceptable to all the beneficiaries for the sibling who wants to keep the property to purchase their shares through a payment plan. There are as many solutions as you and your siblings can get creative.
If you are involved in a dispute with your siblings regarding whether to sell a jointly-inherited property, you should discuss your situation with an experienced partition action attorney sooner rather than later. Regardless of whether you want to keep the house or sell it, the earlier you involve a probate litigation lawyer, the better. Not only can an attorney help you file or defend a partition action in court, but if you speak to a lawyer quickly enough, they can help you negotiate a settlement agreement that allows you to avoid court altogether, as well as the financial and emotional costs associated with litigation.
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About RMO, LLP
RMO LLP serves clients in Los Angeles, Santa Monica, Ventura, Santa Barbara, San Francisco, Orange County, San Diego, Kansas City, Miami, and communities throughout California, Florida, Missouri, and Kansas. Our founder, Scott E. Rahn, has been named “Top 100 – Trust and Estate Litigation” by SuperLawyers, Trusts and Estates Litigator of the Year, and Best Lawyers in America for Litigation – Trusts and Estates. For a free consultation, call (424) 320-9444 or visit:https://rmolawyers.com.
As an expert in real estate law and inheritance matters, I can confidently provide insights into the complexities of inheriting real estate, especially when multiple beneficiaries are involved. My expertise is grounded in a deep understanding of legal proceedings, such as partition actions, which are essential in resolving disputes related to jointly inherited properties.
The article touches upon several crucial concepts that are fundamental to understanding the challenges and solutions associated with inheriting real estate with others. Let's break down the key concepts:
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Inheriting Real Estate with Multiple Beneficiaries:
- The article highlights the challenges of inheriting real estate, particularly when siblings jointly inherit their parent's home. This scenario often leads to increased family tensions, adding emotional stress to an already challenging situation.
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Buyout Agreements:
- Siblings are encouraged to work out arrangements, such as buyout agreements, to settle disputes amicably. A buyout agreement involves one sibling purchasing the shares of the other beneficiaries who wish to sell their interest in the inherited property.
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Partition Action:
- In cases where siblings cannot reach an agreement, California law allows for a "partition action." This legal proceeding enables co-owners to seek a court order either to sell the property or, if feasible, divide it into separate parcels for each owner. However, the more common outcome is a court-ordered sale with proceeds distributed among all co-owners.
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Options for Sibling Living in the Inherited Property:
- If one sibling resides in the inherited property and opposes a sale, they may have the option to buy out the other siblings' shares if financially viable. Alternatively, the siblings seeking to sell can initiate a partition action to force a sale, even against the objections of the sibling residing in the property.
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Settlement Agreements:
- Even after the initiation of a partition action, there is still room for negotiation. Siblings can reach settlement agreements, with one common scenario being the sibling residing in the property buying out the shares of siblings who want to sell. Creative solutions, such as renting the property or exchanging it for other estate assets, are also mentioned.
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Involvement of a Partition Action Attorney:
- The article strongly advises consulting with an experienced partition action attorney early in the process. An attorney can assist in filing or defending a partition action and, if engaged early enough, help negotiate settlement agreements. Early legal intervention can potentially avoid the financial and emotional costs associated with litigation.
This comprehensive overview underscores the legal complexities involved in inherited real estate disputes and emphasizes the importance of seeking legal counsel to navigate such situations effectively. If you have any questions or need further clarification, feel free to reach out.
