Selling Jointly Owned Property in Fayetteville, NC

Selling Jointly Owned Property In Fayetteville, NC

Preparing to sell your house involves a long list of decisions: when to sell, how to sell, how much to sell, whether to hire a real estate professional or sell to a house-buying company in Fayetteville and other cities in North Carolina, and more. Selling a property takes an average of 1 to 3 months on the market. And even if you’ve found a promising potential buyer, the decisions don’t end–negotiations continue until contracts are signed. This is the ideal scenario. 

But what happens when there are multiple co-owners? The process can take even longer, as instead of one voice, you need to take into account everyone’s input. This adds complexity to selling jointly owned property compared to selling one that is solely owned. But don’t fret, we’re here to guide you through your options and help make your property sale as smooth as possible!

Understanding Joint Property in Fayetteville, NC

Joint property means that two or more people co-own a single property. How the property is owned and shared depends on the type of co-ownership in place. North Carolina is not one of the nine states that follow community property laws; instead, it follows equitable distribution. This means assets are not automatically split 50-50, but rather in a manner that’s considered fair and equitable. When it comes to jointly owned property in North Carolina, there are several ways that co-ownership can be structured: Tenancy in common, Joint Tenancy (With Right of Survivorship), and Tenancy By The Entirety. 

Tenancy by the Common 

In a tenancy in common, each co-owner may hold an uneven or equal share of the property, depending on the terms of the agreement. That being said, each co-owner still has an undivided interest in the property, which means each one has an equal right to use and enjoy the property in its entirety, regardless of their ownership percentage.  

When a co-owner passes away, their share of property does not automatically transfer to the other co-owners. Instead, it becomes part of their estate and is passed on according to their will or estate plan. If no estate plan exists, the share will be distributed according to state intestacy laws. 

Tenancy in common is the default form of joint ownership in North Carolina, even for married couples, unless a different form of ownership is specifically stated. 

Right to Sell Property In Tenancy In Common

If you own property under tenancy in common, selling your share may be easier than you think. Since each co-owner holds an individual, undivided share of the property, rather than co-owning the entire property, you have the legal right to sell your share independently. 

In a tenancy in common, you can sell your share of the property without the knowledge or consent of the other co-owners. 

But of course, it’s not as simple as that. It’s often difficult to find a buyer willing to purchase only a partial interest in property, especially if they don’t know or trust the other co-owners. If your co-owner strongly opposes the sale, it could discourage potential buyers. After all, most people don’t want to co-own property with someone who’s in open disagreement with their fellow owners. 

One possible situation where this might go smoothly is if the property is owned among family members, and the share is being sold to another family member that the co-owners are comfortable with.  

Still, selling the entire property or reaching an agreement with the other co-owners usually results in smoother transactions. An even better option might be to offer your share to the other co-owners first, as they may be interested in buying you out. 

Joint Tenancy With Right of Survivorship

There are two types of joint ownership that is often referred to as “joint tenancy”: joint tenancy and joint tenancy with right of survivorship. In North Carolina, joint tenancy with right of survivorship is more commonly used. 

Traditional, joint tenancy requires equal ownership shares among co-owners. However, North Carolina allows either equal or unequal ownership interests, as long as it aligns with the terms of the agreement. Similar to tenancy in common, all co-owners in a joint tenancy, regardless of their ownership percentage, have the same right to use and enjoy the entire property.  

The key difference between the two forms lies in what happens when a co-owner passes away. In joint tenancy with right of survivorship, when one co-owner dies, their interests in the property automatically transfer to the surviving co-owner(s). This happens regardless of any will or designated beneficiaries. On the other hand, joint tenancy (without right of survivorship) follows the deceased’s will or intestate succession laws. 

Rights to Sell Property in Joint Tenancy With Right of Survivorship

Whether you own an equal or unequal share of a property under a joint tenancy with right of survivorship, you can sell your ownership interest without the consent of the other co-owners.  

However, selling your shares sever the joint tenancy. Once the transfer occurs, the ownership structure automatically converts to a tenancy in common for the new owners and the remaining co-owners. This change eliminates the right of survivorship, meaning the new owners’ share will no longer automatically pass to the other co-owners upon death.  

Homeowners often choose joint tenancy with right of survivorship to avoid probate, as the property passes directly to surviving co-owners upon death. However, this benefit only applies to the original co-owners. Once the share is sold and new ownership is introduced, the right of survivorship is lost, and probate avoidance no longer applies. 

So if you wish to sell, it’s best to discuss with your fellow co-owners on the best course of action. Whether it’s to agree to a buy-out, sell the entire property, or turn it into a tenancy in common. 

Tenancy By The Entirety

North Carolina is one of the few states that recognize tenancy by the entirety, a special form of joint property ownership available only to married couples. In North Carolina, this form of ownership is limited to real property (i.e. real estate). 

Under tenancy by the entirety, both spouses are considered to own the entire property together as a single legal entity, rather than as individual co-owners.  

One of the benefits of tenancy by the entirety is the right of survivorship. If one spouse dies, the surviving spouse automatically becomes the sole owner of the property, bypassing the probate process. However, this means that if one spouse dies, they cannot pass on their interest through a will. 

Rights To Sell Property In Tenancy By The Entirety 

When property is held as tenants by the entirety, both spouses must agree to any sale or transfer. Neither spouse can unilaterally sell or transfer the property without the other’s written consent.  

This is because the law treats married couples as a single entity, and therefore, all decisions regarding the property must be made jointly. Additionally, the property cannot be divided or sold in part–it must be sold in its entirety, as the name indicates.  

How to Sell Jointly Owned Property 

Joint property ownership can be great: whether it’s friends sharing the cost of a home, business partners investing in real estate, or newlyweds starting their life together. It allows for shared responsibility when it comes to household chores, maintenance, bills, taxes, and the initial purchase price. 

However, challenges can arise when co-owners are no longer aligned or begin to disagree. In such cases, selling jointly owned property becomes more complex than a typical home sale. Fortunately, there are several options available to help navigate the process and choose the approach that best fits your situation. 

Option 1: Sell As-is 

An average American house is owned for 13 years–a sign of a well-lived and well-loved space. But with time comes natural wear and tear. If you’re considering selling your marital home, perhaps with thoughts of downsizing now that the nest is empty, one option is to sell it as is.  

Making repairs before selling can be expensive and time-consuming, often costing hundreds or even thousands of dollars, something many sellers are not prepared for. Selling as-is allows you to avoid the hassle of renovations and move forward without delays. 

For a faster, stress-free experience, consider selling as is for cash. This can be especially helpful during a divorce or a major life transition when simplicity and speed matter most. 

Option 2: Sell With a Real Estate Expert 

You can always go the traditional route by hiring a real estate professional. This is a solid option if you have time to wait, as it takes several months for a home to sell on the market. 

Keep in mind that before listing, you’ll likely need to go through all the prep work, such as marketing, staging, open houses, and possibly making repairs–all of which require time, effort, and money. Don’t be worried, though, because of course your agent will handle most of the heavy lifting.

That said, working with a real estate professional often helps secure the highest possible offer for your home. This can help offset the agent’s commission fee, which typically ranges from 3%- 6% of the final sale price. 

Option 3: Sell On Your Own 

If you purchased a jointly owned property as part of a business venture, this option might be your best bet. You can choose to sell the property on your own, a process known as “For Sale By Owner” (FSBO). This approach follows the same basic steps as a traditional sale, but you’ll be responsible for everything a real estate expert would normally handle, from listing to negotiations. 

Keep in mind that North Carolina law requires the involvement of a real estate attorney during the closing process. 

However, FSBO is generally not recommended for first-time home sellers, as it often fetches a lower sale price due to common amateur mistakes such as incorrect pricing, poor-quality photos, or ineffective marketing strategies. 

How Are Proceeds Split In a Joint Ownership? 

If you’re wondering how much you’ll receive from selling a jointly owned property, it depends on your ownership share. For example, if your agreement is 70/30, 60/40, or 50/50, your portion of the proceeds will reflect that split after deducting any selling costs, such as real estate commissions, filing fees, and necessary repairs.  

Before listing the property, it’s essential that all co-owners agree on a sale price. This ensures everyone has a clear understanding of what they’ll receive after expenses are deducted. 

To get a ballpark estimate of your expected proceeds, you can check recent sales or similar properties in your neighborhood. Or for an accurate assessment, it’s a good idea to hire a professional appraiser.  

You should also consider whether one co-owner contributed more financially, such as covering the down payment or paying for major repairs.  In such cases, they may expect a larger share to reflect their investment. Having these discussions early can help prevent disputes later on. 

However, it’s different if the property is held under tenancy by the entirety, as North Carolina is an equitable distribution state. In the event of a divorce, how the property is divided will depend on your divorce agreement and the court’s determination of what is fair and equitable. If you’re exploring options, here’s how Wake County Home Buyers can help simplify the process and guide you through your next steps.

What to Do If a Co-Owner Refuses to Sell? 

Jointly owning property with another person would complicate matters, but owning it with multiple people can make things even more difficult. Everyone has their own opinions, and sometimes it’s hard to see eye to eye. This can become especially challenging when a decision needs to be made quickly, as delays can lead to unnecessary expenses like utility bills, property taxes, and other ongoing costs of maintaining a home. 

So, what can you do if a co-owner refuses to sell? Fortunately, there are several options to consider, ranging from negotiation to more serious legal actions, depending on the situation. 

Hire a Mediator 

If discussions have been ongoing for months, emotions can run high, and conversations may become heated. In such situations, it can be difficult to truly hear and understand what the other person is saying. Hiring a mediator can help, as they serve as a neutral third party to guide negotiations and facilitate clear communication. 

Sometimes, a co-owner may struggle to express why they don’t want to sell. It could be that the property is an ancestral home, and they feel emotionally attached to it. Or it might simply be a misunderstanding–they may have been willing to sell all along, just not to the current buyers, or they may prefer to wait another month. 

Consider a Buy-out 

If co-owners can’t agree on selling the property outright, a buyout may be a practical solution. In a buyout, one co-owner sells and transfers their ownership interest to another co-owner who wants to keep the property. This approach can provide a win-win scenario, allowing one party to exit the arrangement while the other retains ownership. 

A mediator can be helpful in facilitating the process and ensuring that both parties reach a fair agreement. However, a buyout isn’t always feasible. The remaining co-owner must have the necessary funds or qualify for financing to purchase the other’s share. There may also be disagreements over a buy-out among multiple owners, as it could create an uneven ownership interest amongst them. 

Sell Your Individual Shares 

If a buyout isn’t feasible and the property is a tenancy in common or joint tenancy with or without right of survivorship, you may have the option to sell your individual share of the property. 

However, this can be challenging, as potential buyers must be willing to co-own the property with others. Because of this, selling your share is typically more realistic when the property is shared among family members or when co-owners are open to bringing in a new partner. 

Keep in mind that while you’re allowed to sell your interest, it may be harder to find a buyer willing to accept the limitations of partial ownership. 

File a Partition Action 

If all other options fail, your resort may be to file a partition action. A partition action is a legal process that allows a co-owner to force the sale or division of jointly owned property through a court-ordered proceeding, even if the other co-owner(s) object. This is often necessary when co-owners cannot reach an agreement, and one party no longer wishes to co-own the property. After all, the law cannot force someone to remain in shared ownership against their will. 

The court will typically order one of two outcomes:

• Partition by Kind: The property is physically divided among the co-owners. This is only possible if the land is large enough to be split fairly without significantly reducing its value. 
• Partition by Sale: More common in residential cases, this occurs when the property cannot be reasonably divided. In this case, the court orders the property to be sold, and the proceeds are distributed amongst the co-owners based on their ownership shares. 

Do note that before filing a partition action, make sure that you’ve exhausted all avenues. The process can be time-consuming, expensive, and may damage relationships between co-owners. Additionally, court-ordered sales often result in a lower sale price than voluntary market listing. 

Tips for Selling a Jointly Owned Property 

Selling a house is a major life decision, and when multiple people are involved, it can get even more nuanced. Fortunately, there are steps that you can take to make the process smoother and less stressful. 

1. Understand Your Ownership Type

Before anything else, it’s essential to understand what type of joint ownership you have: tenancy in common, joint tenancy with right of survivorship, or tenancy in entirety. Your ownership type determines whether you can sell your share independently or must come to a unanimous agreement with the other co-owners. Knowing this will help you make an informed decision on how to proceed. 

2. Gather and Organize Your Documents 

While you’re looking over your ownership status, be sure to collect and make copies of all documents and any agreements related to the property. Having everything in writing, from deeds and titles to any agreements between co-owners, will help avoid misunderstanding and ensure a smoother sale. 

3. Seek Professional Guidance

Suppose you decide to move forward with the sale. In that case, it’s highly recommended to consult with a real estate attorney or a cash home buyer in Greensboro and surrounding North Carolina cities experienced in joint property sales, especially if disagreements abound. They can explain your legal rights, help navigate any disputes, and manage the paperwork involved. 

4. Maintain Open Communication 

When dealing with multiple co-owners, clear and consistent communication is key. Keep everyone informed throughout the process to avoid surprises or conflict. If disagreements arise, consider bringing in a mediator to facilitate discussions and keep negotiations on track. 

5. Prioritize Cooperation And Compromise 

Successfully selling jointly owned property often requires a spirit of cooperation and flexibility. Approach negotiations with the goal of reaching a mutually beneficial outcome. Oftentimes, that means agreeing to a buyout or waiting for a better time to sell. Take your time and avoid making rushed decisions that could lead to regret.

Final Thoughts: Selling Jointly Owned Property in Fayetteville, North Carolina 

Selling a jointly owned property in Fayetteville doesn’t have to be difficult. There are several options at your disposal to ensure a smooth and successful sale. Just be sure to consider everyone’s perspective and not just your own. 

For many people, a home is more than just property–it’s a comfort zone, filled with memories. Parting with it can be emotionally challenging. That’s why it’s important to remain considerate and flexible to your co-owners’ needs in order to reach a mutually beneficial outcome. 

Want to experience a stress-free and hassle-free sale?

We are the Wake County Home Buyers and we buy houses as-is: no repairs, cleanup, or staging required! Whether your home is in disrepair or in need of a little love and care we can buy it in as little as 7 days, guaranteed.

We provide a no-obligation, absolutely free, competitive all-cash offer directly to your email. 

If you have more questions or are ready to sell your home today, just reach out to us by calling (919) 473-6885 or by filling out the short form below. We’d love to chat and learn more about your home.