Q: My husband and I would like to sell our 2 rental properties. We are 50/50 owners with a friend
We plan on moving out of CA within next few years and would like to sell. Our partner would like to hold on to them and buy us out. Is this a simple process? Can we just agree on a price and move title over to him and he buy us out? Or is there a lot more involved? We have been splitting revenues and paying taxes 50/50 since purchasing 10 yrs ago.
A: You usually would need a sales contract and disclosures etc to avoid possible problems in the future.
Who has been managing the properties?
If you can't agree on terms, you could file a partition action in Court and have the properties put up for sale in full, which might fetch a better price.
A: It should be a simple process if you all parties involved can arrive at an agreed upon sale/purchase price. However, be mindful that there could be tax consequences - you should speak with your tax accountant to determine what they may be and if you should consider doing a tax deferring IRC Sect. 1031 exchange.
A: It depends on how you hold the title. If you are tenants in common, then you can convey your interest by deed. However, if you have a partnership agreement, then transferring ownership will be governed by the partnership agreement. Most likely you will assign your interest in the partnership to the buyer.
I would encourage you to have a written agreement that spells out the terms of the deal. There are also possible tax implications that you should run to ground with your accountant. Finally, I would conduct the transaction with the help of a title insurance company, get a preliminary title report, open an escrow, and get the title insurance updated upon closing.
Justia Ask a Lawyer is a forum for consumers to get answers to basic legal questions. Any information sent through Justia Ask a Lawyer is not secure and is done so on a non-confidential basis only.
The use of this website to ask questions or receive answers does not create an attorney–client relationship between you and Justia, or between you and any attorney who receives your information or responds to your questions, nor is it intended to create such a relationship. Additionally, no responses on this forum constitute legal advice, which must be tailored to the specific circumstances of each case. You should not act upon information provided in Justia Ask a Lawyer without seeking professional counsel from an attorney admitted or authorized to practice in your jurisdiction. Justia assumes no responsibility to any person who relies on information contained on or received through this site and disclaims all liability in respect to such information.
Justia cannot guarantee that the information on this website (including any legal information provided by an attorney through this service) is accurate, complete, or up-to-date. While we intend to make every attempt to keep the information on this site current, the owners of and contributors to this site make no claims, promises or guarantees about the accuracy, completeness or adequacy of the information contained in or linked to from this site.