One of the reasons I always recommend to tread with extreme caution when owning properties jointly (not through a corporation) with one or more people, is the issue of dissolution.
Put simply, when a property is jointly owned there are 3 options when it comes to a sale: a) death, b) mutual consent or c) court order.
Now, unless your goal is to go to prison for murder or spend 10’s or 100’s of thousands of dollars in court, you’re going to have to play nice with your lovely ex.
More often than not, delays from one party in signing or finalizing the sale comes down to pride, spite, and hate. It rarely comes down to sound, financial decisions as it always makes the most mathematical sense to avoid court, lawyers and jail (in the event you opt for option a) above).
Recently, I completed a deal for a client who had purchased a 1.4 million dollar home where ALL of the money for the down payment and closing costs would come from a very messy divorce process. Her ex knew of this purchase and used it against her. When I met with her, I explained the process and despite her ex being a complete asshole, he had her by the metaphorical balls. She was fucked, and not in a good way I assure you.
My advice was this – getting him to consent to the divorce and ultimately release her funds was her best avenue. It was cheaper and quicker than the alternatives. But being a narcissist required that she played at his level. I developed a proposal that she would present to him for settlement; one in which he would feel like he won but in the end, she got what she wanted. Sure, it wasn’t completely fair in terms of equity but fairness rarely has a place within the law.
She will get her money next week and she will move into her new home next month – with her new man.
Ain’t love grand?
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