Real Estate is not always simple. In fact, many times it can be very complicated.
One of those times is when a property has been inherited and now there are multiple property owners. This can create a messy situation when one or some of the property owners want to sell, while others do not. We frequently work with this type of issue and know how to assist you in working through the process.
Often times in these cases, one person takes on the responsibility of making sure the property is maintained and the taxes are paid. This is usually the person who calls us for help. After years of spending his/her own money, he/she usually wants out of the situation and would like some relief.
Here is an example:
Mrs. Smith was the mother of 3 children. One of her children predeceased her. When Mrs. Smith died, her will stated the property would be sold and the proceeds be divided between her two living children and the three children of her deceased child.
Eight years later, the property still has not been sold. It is overpriced and has been since day one. One of the children has paid all the expenses during this time, including property taxes, lawn care, insurance, and some maintenance. The property needs additional repairs and has lost value during this time. It is possible the eventual sales price will not cover eight years worth of expenses.
Two more issues complicate this situation even further.
First, when Mrs. Smith’s estate was closed, a deed of distribution was filed. All five now have an ownership interest in the property. (When the estate was open, the personal representative had the sole power to sell under the authority of the will.) Any sale of the property will now require the approval of all 5 owners. Unfortunately, the 2 siblings have lost contact with their nieces and nephew.
Second, our preliminary title information shows Mrs. Smith only owned a one-half interest in the property. When her husband died in 1976, she failed to probate his estate and deed his half of the real estate to herself. Since this is beyond the statute of limitations of 10 years for opening an estate, now Mr. Smith’s estate will have to go before the court for a determination of heirs.
This is a messy and complicated situation, but we deal with these all the time. We can fix these title problems and sell the property.
If you own inherited property with others, it is better to sell early and divide the cash. Most of the time, property cannot be divided equally.
And, who is going to pay the expenses? Remember, just because you pay all the expenses doesn’t mean you own it.