I need to sell half a house to a family member, and I don't know how.
November 7, 2007 8:25 PM   Subscribe

How do I sell half a house to my brother, who’s living there? My only sibling and I have inherited our late parents’ house as part of the estate. He’s currently living in it, and is happy to stay and is interested in buying my half out. I don’t want half the house; I do want the money.

How do we go about concluding this transaction? Do we get a lawyer to draw up the paperwork necessary? Is a realtor involved? I’ve never done anything like this at all, and since it involves asking for money, and the consequences of death, I’ve been procrastinating, as both things make me either uncomfortable or sad. However, we would like some money, and the longer this goes on, the longer my brother lives rent-free, which isn’t really fair. (But I haven’t raised the issue of that with him, so it’s my loss, and I don’t intend to contest it.)

How do we get this deal done and over with? I assume my brother will need to make the payment in certified funds of some sort. I’m in a different city than he and the house; we are both in British Columbia (Canada). Tax consequences I should be aware of?

Any pointers would be great, and then I’ll finally have no excuse for this procrastination. Thank you.
posted by Savannah to Work & Money (4 answers total) 4 users marked this as a favorite
Please keep in mind, my knowledge and therefore advice is based in the United States. Canadian law is probably fairly similar, given their common roots in British commonlaw, but things could be completely different.

To clarify: you own half of the house, he owns the other. He wants to buy your half, you want to sell it to him.
You don't really need anything special -- sign a deed and take payment. It's your business how you take payment; if you wanted to accept gumballs in exchange for the title, you could do that. Lots of sellers in the US carry the mortgage themselves, meaning they just take monthly payments from the buyer until the house is paid off.
Your situation is even simpler. Just agree on a price (this is where getting a realtor, appraiser, or other third party might be useful), agree on a method of payment, and sign over the deed. No need to partition -- you're actually basically reversing the partition. A lawyer might be useful if you're taking anything other than a whole amount, lump sum payment, just to make sure you've got protection if he fails to fulfill his obligation.
Talking to a lawyer will probably make you feel better, and will help you get all you i's dotted and t's crossed, but you could probably get by just fine sitting down at the kitchen table and swapping deed for cash. I have no clue what the tax consequences would be in Canada, and an accountant or tax lawyer would probably be the right person to ask about those things.
I'm very sorry for the loss of your parents, and I know that dealing with estates can rip families apart. It sounds like you're lucky in that you both want the same thing; keeping it uncomplicated and not letting either of you feel screwed over by the other is important.
posted by katemonster at 8:34 PM on November 7, 2007

"I’m in a different city than he and the house; we are both in British Columbia (Canada). Tax consequences I should be aware of?"

I don't know the income tax implications but your brother may have to pay property transfer tax of 1% on the first 200K and 2% of the remainder of the fair market value.
posted by Mitheral at 9:34 PM on November 7, 2007

Get an appraisal, settle on a price, and call in a real estate lawyer and an accountant. This is not a complicated transaction.
posted by JimN2TAW at 6:49 AM on November 8, 2007 [1 favorite]

You could look at the NOLO guides to get some idea of the process, though they may not have one for your municipality. Here in the US the process would involve a payment and a quit-claim. You certainly would not need a realtor.

When you inherited who handled the transfer? They might be a good contact. Given your prior relationship and their existing knowledge they will likely give you a free consult and might do it at a reduced rate.
posted by phearlez at 3:04 PM on November 8, 2007

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