Co-Owners and Property Rights

property-disputeWe are often contacted by clients who find themselves in difficult situations because they purchased real property with a non-spouse third party such as a boyfriend, girlfriend, in-law, or child. The reasons for doing so are varied and usually good-intentioned. For example, a parent might want to help their child or a child’s spouse build a credit rating. An unmarried couple may be engaged and purchased the property together in anticipation of marriage. In the most difficult cases, while both parties take title to the home, only one is obligated under the mortgage loan. If these relationships deteriorate, it leaves the parties in a very difficult situation. Especially the person who is liable for the loan. It is important to understand that when people take title to property together, they each have an undivided right to occupy or otherwise enjoy the property. If the relationship sours or one party finds themselves paying all of the bills related to the real estate, there are very limited measures that can be taken to unwind the transaction if the other party does not cooperate. The property cannot be placed on the market without the consent of both parties and the parties cannot charge each other rent, even if only one is living in the property. Short of litigation, there is no way to force a co-owner to vacate the property or to pay their fair share of expenses. Litigation, in these case, typically takes the form of a Complaint for Sale in Lieu of Partition, in which the Plaintiff asks the Court to force the real estate to be sold and any equity split among the owners. This litigation is time consuming, expensive, and often leads to a sale for less than market value. If you are considering purchasing real property with someone who is not your spouse, consult with a competent attorney to discuss measures to protect your interest and avoid costly litigation if the relationship deteriorates.

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