What is the best way to pay a sibling their portion of value of our inherited home?

Question

My brother and I inherited our mother's paid off home. He wishes to get his half of the value of the home and I wish to live in it temporarily before eventually selling. Don't know how to go about this and I am fearful of placing myself in debt or not being able to profit from the selling of the house once sold.

Gerald Bagazinski · Answer

Your brother wants to sell the house now. You want to avoid going into debt to buy the house and do not wish to assume any risk of loss in the event of a market downturn.  One of the questions, There are options available to you. 

How long is temporary? You can live in the house while it is being marketed and sold. I would have is whether your desire to remain in the home is a desire to have a place to live rent free. Your brother could ask you to pay a fair rent. 

You could try and negotiate a 90 or 120 day occupancy provision with the buyer. This would impact the marketability of the home. You might yield less as a seller. You would have to pay rent equal to the Principal Interest Taxes and Insurance (PITI) the buyer would incur. 

I would talk with an attorney who could help you  explore the options available to you.

S Hunter · Answer

The best way to give your brother his share of the estate depends on what your brother is willing to do. You could pay him rent for a period of time. You could buy him out of his half. However, if you can't reach an agreement it may have to be sold.

Charles Perry · Answer

You need to negotiate an agreement with your brother as to what you   both want to do.  If necessary, you should meet with a lawyer to help   you negotiate and document the agreement.  There is no "best way" to   handle this situation.  Everything will depend on the specific facts   surrounding your situation.  In addition, there is a significant   amount of money at stake.  A well-documented agreement now will save you the cost and expense of   a dispute with your brother later on.  Best of luck to you.

Robert Slotkin · Answer

He can force a sale, so it is in your best interest to work something out.   I recommend paying rent to the estate (half of which is yours), or if you  can't  pay rent, then promise him a little extra cash when it sells.

Leonard A. Kaanta · Answer

You need ot get the house appraised, he is entilted one half of the appraised value, if you can not buy him out, the house must be sold.

William M. Quitmeier · Answer

A partition suit.

James Oberholtzer · Answer

There are lots of ways to do this.  However, the simplest is for you to buy out your sibling. You borrow one-half of the value of the house.  You pay it to your sibling.  Your sibling gives you a deed for his or her half of the house.  Quod erat demonstradum.

Michael Stafford · Answer

You either have to sell the house and the both of you share the profits, or you have to secure a loan and pay off your brother his share.

Darin Christensen · Answer

1.       If he is willing, give him a personal promissory note payable over time at an agreed interest rate for the amount you agree is the value of his interest.  2.       Borrow the amount needed to buy him out for the agreed value of his interest.  3.       Agree on the reasonable fair market rental value of the home and pay him his proportionate share of that amount (i.e., if reasonable rental value is $1,000 per month and you each own half, pay him $500 per month that you live there).  4.       Sell it now and divide the proceeds rather than fight over the issue.

Brian Haggerty · Answer

You could take out a mortgage and pay off your brother, or hold the property as tenants in common with an agreement concerning your occupancy and the eventual sale.

Edwin Fee · Answer

If you have sufficient assets of your own, you could buy your brother's half.  If your brother is willing to wait until you're ready to sell, then you could live there in the meantime, and you could split the proceeds when the home is sold.  If you qualify, you could take out a home equity loan in order to buy out your brother.

Thomas Edward Gates · Answer

You can get a fair estimate of the home and pay your brother his one-half share.  Or, with today's housing market, it may make sense to maintain the home until such time as the market picks up.  Here, the person living there could pay rent so that the insurance, property tax, and maintenance are covered.

Michael Yeksavich · Answer

I assume there is an attorney handling the estate so ask them this question.   Frankly, there is no good answer unless there is available money to pay.   Whatever is done it needs to be by virtue of a written agreement and if the  estate has not closed I would want the court to approve the agreement.

Dera Johnsen-Tracy · Answer

If your brother owns half of the real estate, then he is in a good position to force the sale of the home should he choose to do so.  If you do not wish to sell the real estate at this time, then you will need to find a way to purchase your brother's interest which may require that you obtain a mortgage.  In the alternative, you may wish to explore private financing options, including a possible land contract, if your brother is willing to negotiate this type of financing with you.

Cristian Arrieta · Answer

Offer to pay him rent until it is sold.

John Brennan · Answer

See an attorney for suggestions.  If your brother wants his money now, you will have to buy him out or he can petition to have the property sold and proceeds split.  You could rent his half.  In any case do it right and in writing.

James Frederick · Answer

It is a tough question, especially in Michigan. I would try to build in some "wiggle room", if you are going to buy him out. In other words, if the house is worth $50k, his share would be $25. But if you SELL the property, there would be transfer taxes, sale commission, perhaps expenses to fix the place up, legal fees. I would deduct HIS half of these expenses from what you offer him. If he does not agree, then just put the place on the market. It will cost you more to fight him on this than it is worth.

Frances Headley · Answer

There are a number of ways that this can be accomplished depending upon how soon your sibling wishes to be paid and what your resources are.  You should consult a probate attorney on how to best structure an agreement between you.

Victor Waid · Answer

In answering your question, First you and your brother could determine the rental value of the home and charge you one half of the monthly rental amount to pay him, as you are living in the home, until the two of you are ready to sell the home. Second You may also want to consider obtaining a loan against the property and buy his interest out; if you have the means of paying a monthly payment back to a lender this may be the way to go in this down real estate market. You would seek financing from a credit union or banking institution; however this may not be appropriate for you. Then the first alternative may be the better one, and you may want to go that route until sale of the home; your brother is certainly entitled to his share of the value. The third and last alternative would to be buy the brother's share with him carrying the mortgage/note secured by a deed of trust issued by you to him with a(30yr) 360 month amortization for monthly payments schedule, with the note payoff due in full at some future date or sooner, such as five years down the road.

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What is the best way to pay a sibling their portion of value of our inherited home?

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