I want to explain how one can get “unstuck” from a bad real estate investment with a co-owner who lives there and refuses to pay the mortgage.
Many people are stuck in “bad real estate deals”, where they cosigned with a loved one to buy property. Unfortunately, just because you no longer occupy the property, doesn’t mean the personal liability of the bank loan and mortgage goes away. The problem with these situations is that the credit report of those who no longer live in the property is easily damaged by the conduct of the property occupant. Put quite simply, the guy who moves away may find his girlfriend’s lack of payments on the mortgage has ruined his credit.
The law has a solution for these kinds of situations. It is called a “suit for partition”. In essence, it is true that if you own real property with someone else, and no longer wish to own that property with another individual, you have the right to sell your interest. Of course, the co-owner occupant can buy your interest, but he/she cannot be forced to. Nonetheless, you can ask the court to order that the property be sold, with you receiving your share of equity, and the other old owner receiving his/her share of equity. Fortunately, since there are so many cosigned mortgage loans where individuals no longer desire to own the property, the law provides this remedy.
Remember–you can actually ask the other co-owner to sell. Indeed the law allows you to demand that he sell, if you desire to “pull out directly”. This is not a negotiation, it is your right and a matter of law. Do you have these kinds of issues with a co-owner, where there might perhaps be bitter feelings between the two of you? Please feel free to call our office at (317) 266-8888 for a consultation, if we can assist you with resolving this rather thorny problem.