Q: If I buy my sister out, both on deed and mortgage, do I pay her back all of the mortgage she paid plus all utilities?
She is fighting because I won't give her half the insurance repair money from a fire. Ins policy states that money only goes for repairs concerning the damage done by fire.
Buying someone out means you pay that person a fair market value (FMV) of the property today minus your half of the ownership. So that if today's FMV is $500K and you own half of it, you end up paying your sister $250K. Your sister would have to use the proceeds of $250K to pay off her share of the remaining mortgage amount. So that if there is a $100K mortgage remaining and she is responsible for one half of it, she'd pay $50K out of $250K toward the mortgage. This is on the mathematics side only. You'd still need to work out refinancing and legal title to the property.
I believe you'll need a lawyer to help you through this transaction.
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