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I am a benificiary of 1/7 share of 120 acres which is currently being sold to pay off estate debts and then benificiaries.
Problem:
My 2nd oldest brother wishes to sell his portion for $5000 which is a substantial less amount than his share is worth. He needs the money now and is willing to forfeit the loss.
Can my brother sell his 1/7 share for $5,000.
Is this legal and how do I make it legally binding. I do not trust my brother for the money.
The 1/7 share could be worth between 15k - 25k.
Have a lawyer draw up a contract for you in which he gives you his share or future rights to the land if you are buying it from him. I don't see why it wouldn't be legal. You'll want to make sure about tax consequences involved because you might end up with some serious capital gains consequences. Not sure how that will work... if your basis would be the price you buy if from him at, or the value at time of inheritance. Right now, it seems like you are buying his inheritance rights, and possibly that will make a difference. I would certainly want to get a good tax accountant and legal advice on the matter.
He should be able to, but then the buyer takes a risk if there were more debts than known, it could end up being less.
But if you want to buy it, at this point, you can
Some issues depend on the state you are in. I am an accountant in Indiana and before I can give you a super detailed answer there are a few more things I would need to know such as how much more debt the estate has to pay out and a few other details. However assuming that any outstanding debts of the deceased have been met and all the beneficiaries will get the full amount they were left, I can tell you this much... people can sell anything for anyamount no matter how silly if he said he only wanted one thousand it could be contracted out for that amount. You really need to contact your lawyer's office to have a contract written up (just to cover your behind) but yes you can buy it for that much. If you need more information just let me know and I'll be happy to do what I can.
Quote:
Originally Posted by usmountainrunne
"Assuming" the estate is still in probate - and it appears it is - in NYS, at least, no one can sell anything because everything is frozen until the estate is settled in order to guarantee sufficient funds to pay estate debts and taxes and specific bequests.
Actually no he can't because it's a joint sale and he has to go through with it. His interest is only 1/7 so unless the others agree or you get together and buy him out then he is stuck with it till its over. That may sound harsh but all of you have a stake in the money that's coming from the sale and for him to short sale like that would affect the interest that all of you have. Now if the rest of you want to buy him out and all agree then it can be done because the sale wouldn't effect the end profit.
And, in my opinion, if you do decide to buy him out, I'd buy him out for the reasonable amount of what he would be entitled to under the will, not what he's asking for. That would stop a lot of hurt feelings later, plus any potential lawsuits from him feeling "cheated" later on.Quote:
Originally Posted by califdadof3
Hello u:Quote:
Originally Posted by usmountainrunne
He owns an asset. Of course, he can sell it, as long as it's properly done. Yes, there's risk to both the buyer and seller. So?
excon
Some conflicting advice here. Unfortunately, califdad3 is incorrect and while Judy is technically correct, it can still be done.
As excon said he owns an asset and any asset can be disposed of barring encumbrances. If the will is still in probate, then the deed cannot be changed, but that doesn't preclude drawing up a contract stating that his interest is being sold to whomever. This actually happens somewhat frequently. Beneficiares will sell their interest in an estate for a discounted amount.
As long as a legal contract is drawn up, there should be no problem.
Hello again:
I should have expounded. Fortunately, I've got Scott to back me up.
This transaction would be similar to the ones you see advertised on TV for companies like Peach Tree Funding. These companies buy long term income instruments like annuities and judgments that are paid out over the years.
Yes, they're sold at huge discounts and there are risks to both sides.
excon
I agree with Scott and ex con.Quote:
Originally Posted by ScottGem
I think califdad3 misunderstood the question. (I think califdad3 thought that the brother wanted to sell his share of the property, not his share of his inheritance.)
And yes the contract clearly needs to be airtight to prevent the brother from claiming his share in addition to the $5000.
However, I would consider adding a clause that gives the brother some additional sum if his share turns out to be a lot more than $5000. You could deduct interest from the difference or discount it, but, in any case, voluntarily reduce the difference between the $5000 and the final amount so as to minimize bad feelings later. A lawyer could help you think this through and get the wording right.
Asking
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