If you are reading this, more than likely you have just entered into probate and have a lot of questions.
This is very common, and you are doing your part to better educate yourself on this journey.
In this article, we are going to cover the common question of “Can Siblings Force The Sale of Inherited Property?”
Before we can answer that question, it’s important to better understand the larger picture of probate.
Table of Contents
Property and Probate
You’ll hear us and any good source of legal information online reiterate on a regular basis that this, not legal counsel, and the probate laws of each state are different. It is important that you do your own research to better understand the probate laws of your state, and seek out the counsel of a licensed probate lawyer in your state for specific legal advice.
Some estates are going to be small enough to pass on the inheritance quickly from the direction of the will or a judge if no will has been prepared. However, these situations typically do not involve assets that are valuable and indivisible to warrant a forced sale process, most commonly involving a home.
Each state has a financial threshold for what must be taken through formal probate. If the entire estate is valued above that threshold, then it must be brought through this process. It is during this formal process that every asset must legally be discovered, recorded, assigned a fair value, and all creditors be paid according to federal and state laws. Furthermore, either the will or the court determines how the remaining inheritance is dispersed. It is during this process of probate case that the discussion of selling an undividable asset comes up.
Can Siblings Force the Sale of Inherited Property?
If probate has been filed, and the executor of the estate has legally transferred ownership of the inherited home to you and your siblings. One of the siblings strongly advocates for keeping the inherited house, and the other(s) want to sell. Both are asking the same question, can siblings force the selling of inherited property?
In brief, yes. Siblings can force the sale of inherited property if the circumstances are right. This is what’s known as a partition action, and generally only occurs under two conditions:
- The first is if a co-owner of the property wants to sell, while the other(s) do not. This isn’t limited to a certain majority either. If only one sibling wishes not to sell, this could be grounds for a partition action.
- The second is if the property itself cannot be divided, typically involving a house as land can be divided in most cases.
Whenever these conditions are met, a family member can force the sale. Generally speaking, the courts do not get involved unless there are some unresolvable disagreements among the siblings over what to do with the property. The partition action legally forces all stated owner(s) to sell and split the proceeds respectively.
In addition, if the property must be sold to settle the outstanding debts of the estate, a judge can rule that it must be sold. If there are no debts and all the siblings are in agreement on what to do with the property, then no further legal course is required. However, if some of the siblings decide to sell the asset and one does not agree, there might be a need for further legal action.
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Why a Forced Sale?
There are many reasons why a sibling would want to force the sale of inherited property. The first and most obvious reason would be to acquire the cash value of the inheritance given to them. In these situations, having cash in the bank makes a whole lot more sense than having extra real estate. If the fair market value of the home has a great outlook after getting the property appraised, there may be more interest in selling at a higher price on the open market. Sometimes, one or more siblings decide to sell the inherited home rather than transforming the property into a valuable asset.
For example, let’s say that after their last elderly parent of a family with four children passed away, each sibling is getting equal shares of the estate with no other heirs. Instead of getting rental income from the old family home, three siblings decide to avoid the headache of being the property manager and simply sell the house. One of them wants money to pay for their daughter’s orthodontics, the other wants the money to pay off some credit card debt, and the other would like to use the money to pay off their car loan. But, one sibling strongly disagrees, claiming that as family members, they could all make money from the rental income year after year. Since none of the siblings live nearby, it seems too difficult to manage for the other siblings. The much larger pay of selling the property is too tempting for the other three owners. Since all four of these siblings own the property equally, then a partition lawsuit might be the only option for the other three siblings to sell.
In another example, perhaps the siblings inherit a vacation home on the beach. Each family member would love to take turns visiting the iconic tourist town, but since the potential vacation property is in a prime location, the sales price would provide a lot of money to the family members. Even though two or more owners want to sell, one sibling thinks keeping the real estate will far outweigh the potential immediate gain of selling the property. If this one sibling refuses to give up their newfound vacation home, a partition lawsuit might be the last resort to achieve the sale of the property.
This brings up the second most common reason for selling: expenses relating to ownership. A lot of people simply do not want to have the added hassle of property taxes, insurance, and maintenance expenses. So, there’s really no conversation of having any real property serve as a vacation home, a rental home, or any other valuable asset.
Are Partition Actions Always Appropriate?
So now you know that a forced sale is a viable legal solution for co-owners who want out of the inherited property, while other(s) wish to keep it. You may still be wondering if partition actions are always appropriate?
There are a couple of instances where it is not appropriate to file a partition action. Since this action must be taken by the owner of the property, it would not be appropriate or in legal order for individuals who have yet to take ownership of the property to file.
A good example of this is if siblings are jointly inheriting a home, but the executor hasn’t transferred the title yet. Even though the siblings are the rightful heirs of the property, they legally do not have ownership of it yet. Therefore, it would not be appropriate to file a partition action. This is not an exclusive example, but simply to illustrate that there are scenarios where it would not be appropriate to file a partition action. You should consult with a probate lawyer in your state for your particular circumstance.
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What Do I Do If My Siblings are Selling Inherited Property?
Each person has their own specific reasons, and it should be noted that each person’s reasons to sell or not to sell are equally valid. If you’re reading this article because you are in a probate situation that’s on the verge of a partition action, we first and foremost recommend finding a good probate lawyer.
If you are the sibling wanting to sell, then filing the partition will be your responsibility. This includes coming out of pocket to cover all of the legal fees to accomplish this. If you are the sibling who has just been given notice that a forced sale is occurring, you will need to find a good probate lawyer as well. As with any other lawsuit, any time prior to the court ruling on a partition action, it can be dismissed if the dispute is settled out of court between the owners.
For the sibling who wants to sell…
Understand that the probate process is different from state to state, so you need to do your own research into the specifics of your state. A vast number of estates will have to go through formal probate in order to legally pass down a property. This can be grueling and time-consuming, often taking from a couple of months to over a year to complete. This timeline gets even longer if someone contests the will. If your inheritance has already been filed into probate and you aren’t interested in going through the entire process, you have another option.
Instead of selling an inherited property after the long waiting period, you can apply for an inheritance advance with our team at Inheritance Advanced. If approved, we can get you a cash payout in just a few days! This is especially helpful if there are still funeral-related expenses that you simply can’t cover on your own.
Considering how forcing a sale might impact the relationship with your family members is vitally important before moving forward. There is a good possibility that the negative ramifications of this process will likely cause irreparable damage to the family dynamic.
So, before going through the courts to settle the dispute, why not seek professional help by hiring a mediator? They can help walk you and your siblings through the possibility of a buyout agreement and advocate for an amicable resolution. This could also be a probate lawyer, in which case you are able to have a qualified professional cover and execute the entire breadth of the conversation.
If you wish to continue through probate, with the full intention of selling against the wishes of any number of other sibling-owners, then you should be made aware of a couple of things.
First, forcing a sale is going to come with a hefty price tag as you will need to retain a good probate lawyer for the duration of the process. In the event that you win the decision to sell, you may request that all of your legal fees be awarded to you. Of course, this means that the defending siblings would be forced to not only cover their defense and court costs but also your litigation costs as well.
Second, if you are the executor of the estate, as the personal representative overseeing the execution of the will, you legally do not need permission from the other siblings to sell property in the estate. This doesn’t necessarily mean that you should. All family members who are inheritors of an estate will potentially have to pay taxes if the sale of the property or house falls under specific circumstances. It would be wise to seek the counsel of a tax expert regarding the sale of the estate, as well as having a conversation with all of the siblings and/or relatives that would be impacted by the sale of any part of the estate. This is why so many siblings opt for an inheritance advance instead of doing a buyout which can be costly and take a lot of time, when you could just receive an inheritance advance and get money right away.
For the sibling who does not want to sell…
In many cases, the fact that a partition action has come into play is due to the unwillingness to have a conversation about the other sibling’s position and desires to sell. So before this action is taken, it is in your best interest to maintain open lines of communication regarding everyone’s desires for the property.
If this doesn’t seem like a reasonable course of action for your family to do, perhaps you should think about bringing in a third party to objectively handle the discussions. A mediator will certainly cost less than the legal fees associated with handling a partition action filed against you, and it could also go a long way in protecting the relationship with your siblings after everything has concluded. In addition, the mediator could be a probate lawyer who could also help execute any decided course of action.
For a mediator to be brought in, there will need to be some flexibility on both parties to reach a common and desirable end goal. For your siblings, they have their reasons for wanting to sell the property, and they are as entitled to feeling that way as you are to wanting to keep the property. More than likely, a key driving factor of them wanting to sell is to either liquidate that asset into cash that can be used in the life they have built, or they do not wish to be held liable for the ongoing expenses of keeping the home. So, a reasonable resolution would be for you to offer to buy them out of their portion.
For a buyout to work, you would need to obtain the current market value of the home, typically through a property and house appraisal process. If there are specific directives in the will regarding the percentage of ownership, then that is how you would figure the sibling’s share. If there is no specific guidance, the asset would be divided evenly among the siblings. Many find that accomplishing this oftentimes requires obtaining a loan.
If you do not have the funds on hand to do so, and you cannot obtain a loan due to your current financial standings, chances are you also don’t have the funds to cover the legal fees to fight this battle. In this case, if you are really determined to keep the property, perhaps it would be worth looking into getting an inheritance advance. Our team at Inheritance Advanced offers a free consultation to see if this could potentially help fund purchasing the real estate when it is later sold at auction or through a real estate agency.
In some instances, filing for a partition action is not warranted, and appropriate legal counsel will be able to determine if there is a case against you in this situation. Retaining a law firm is not cheap, and the winner of the case has the right to request their legal fees and court costs be covered by the losing party. Really examine whether or not this situation is irreconcilable before becoming the defendant in a partition action lawsuit.
Apply for an Inheritance Advance Today
Inheritance Advanced serves more than 1,560 clients in Florida and across the country. Our experienced and trusted team understands how difficult this process can potentially be. The reasons our clients choose to get an advance on their inheritance vary. For some, it’s the financial pressures surrounding the funeral costs. For others, they could use the inheritance that rightfully belongs to them today instead of waiting until formal probate is completed. There is no specific reason required to obtain an inheritance advance. The probate process could take months to deliver the results you desire, whereas we can deliver an inheritance advance within days of approval! We are here to help serve you with a free consultation, so give us a call at (866) 510-2576 to speak with a member of our team today!