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Buyer Beware: Purchasing Real Property

It is commonplace for people to purchase a house or invest in real estate together. Whether purchasing with a sibling, significant other, or friend, people generally don't foresee their relationship with that person ending poorly-otherwise, they would not be making such a big purchase together in the first place.

Unfortunately, there are times that these relationships do come to an end, and two people are stuck sharing a very large asset and/or liability. Sometimes the parties can agree to sell the property and split the proceeds, but this usually is not the case. A party may refuse to leave the property, refuse to pay the other party for their share of the house, or simply refuse to cooperate at all. Even married people could have separate property interests that cannot be split in a divorce proceeding. When something like this happens, there is really only one solution and it can be costly.

The Texas Rules of Civil Procedure outline the process for a "partition" of real property. This allows a person to file suit to either have the court order the sale of the house via court-appointed receiver or appoint commissioners for a partition in kind (aka literally split the property up and then sell it). A suit for partition can be pursued regardless of whether the property is a party's homestead--with some exceptions for creditors and debtors--as Texas law does not hold one person's interest in real property greater than another's. Grant v. Clouser, 287 S.W.3d 914 (2009). This just means that the homestead protection will attach to that person's share of the sale proceeds, and it will not block the sale.

You should absolutely consider this when purchasing a house or any other kind of real estate with a non-spouse.

If you need to partition property, or are considering it, please feel free to contact the Yale Law Group at (940) 891-4800.

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