Ask Me Help Desk - Real estate

Real estate

I own property and have a co-signor. The property is up for sale and possible proceeds may occur. Upon asking for this individual to help me, and co-sign a verbal agreement was made that if/when house sells, let me get my money back that I put into it. I would gladly split anything leftover after the remodel, appliances, much that was fixed/repaired.

The co-signor is on mortgage and deed. Legally what rights do they have, and at closing being there is two of us, is 1 check disbursed or 2?

Would appreciate any insight, not looking to be rude to another, would just like monies that I had put into home that is selling it at decent price now.

TY

Legally he own one half the property and is entitled to one half the proceeds. The buyer will first issue a check to the mortgage holder to pay the balance of the loan. The difference between that and the sales price will usually be issued in a check made out to both owners. You can have the buyer issue 2 checks if you want.

How does one sign a verbal agreement?

If you want to be reimbursed for improvements you made to the property, you will need to document the expenditures.

Quote:

Originally Posted by ScottGem

.... How does one sign a verbal agreement?
...

That's not what OP wrote This is the quote:
"...Upon asking for this individual to help me, and co-sign a verbal agreement was made ..."

OP indicated that the verbal agreement was made at the time the other person co-signed. She should have put a comma after "co-sign".

But actually, this other person is more than ia co-signer. As you have indicated, Scott, that person is a co-owner, if on the deed.

Either I wasn't thinking straight this early in the AM or the OP was edited. In either case, we understand now.

Quote:

Originally Posted by ScottGem

Legally he own one half the property and is entitled to one half the proceeds. The buyer will first issue a check to the mortgage holder to pay the balance of the loan. The difference between that and the sales price will usually be issued in a check made out to both owners. You can have the buyer issue 2 checks if you want.

How does one sign a verbal agreement?

If you want to be reimbursed for improvements you made to the property, you will need to document the expenditures.

Okay, if both names on mortgage, deed. Don't both have to agree to have the checks cut separately? Who cuts the check and who has to be contacted in order to request 1 check until the improvements and other expenditures can be figured out so that the one who paid for the mortgage for year, improved home so that the market value increased is reimbursed?

You should have an attorney or, at least, a title company rep to represent you at the closing. You work this out with that person.

You need to work out, before hand, what costs you want to be reimbursed for.

Quote:

Originally Posted by AK lawyer

That's not what OP wrote This is the quote:
"...Upon asking for this individual to help me, and co-sign a verbal agreement was made ..."

OP indicated that the verbal agreement was made at the time the other person co-signed. She should have put a comma after "co-sign".

But actually, this other person is more than ia co-signer. As you have indicated, Scott, that person is a co-owner, if on the deed.

Who do I contact to make sure the proceeds ar in 1 check until all the improvements, etc can be figured in. The co-signor is entitled to monies don't get me wrong. Half, I think not. I had paid mortgage for year faithfully, improvements and increased value of home. I am more than willing to give cut, 1/2 is out of the question.
TY

Quote:

Originally Posted by phyllis1

Who do I contact to make sure the proceeds ar in 1 check until all the improvements, etc can be figured in. The co-signor is entitled to monies don't get me wrong. Half, I think not. I had paid mortgage for year faithfully, improvements and increased value of home. I am more than willing to give cut, 1/2 is out of the question.
TY

You don't have much of a choice. Legally he is a 1/2 owner of the property and is therefore entitled to half the proceeds from the sale. You gave him an half interest in the property when you put him on the deed.

If you have an agreement that allows you to deduct your expenses from the proceeds of the sale, then you need to get that in writing or be able to prove it. If the co-owner claims half the proceeds, he's legally entitled to them.

Quote:

Originally Posted by phyllis1

Who do I contact to make sure the proceeds ar in 1 check until all the improvements, etc can be figured in. The co-signor is entitled to monies don't get me wrong. Half, I think not. I had paid mortgage for year faithfully, improvements and increased value of home. I am more than willing to give cut, 1/2 is out of the question.
TY

The buyer isn't going to care how you and the other owner divvy up the proceeds. That is between the two of you. If you want separate checks, it should be spelled out in the escrow instructions. Absent that, expect a check made out to the two of you and if you can't agree at that time you won't be able to cash the check.

I have been buyer and seller at several such closings, with multiple buyers and sellers. An attorney was always present, usually one for buyer(s) and one for seller(s) but not always two. The attorney cuts the checks and unless the deed says otherwise, each party gets half after the bank gets their balance due.
Your agreement really should be done BEFORE you arrive at the closing. Banks and lawyers aren't interested in taking time with your side contract. You and your co-owner should make adjustments by writing checks to each other at the end of the closing.

You should give written instructions to the closing agent prior to closing that the check for the sellers' proceeds must be made out in the form of one check payable to both of you and you specifically do not agree to separate checks.

Quote:

Originally Posted by LisaB4657

You should give written instructions to the closing agent prior to closing that the check for the sellers' proceeds must be made out in the form of one check payable to both of you and you specifically do not agree to separate checks.

Doesn't that require the cooperation of the other owner?

Quote:

Originally Posted by joypulv

Doesn't that require the cooperation of the other owner?

If, as Lisa suggested, OP insists on one check, yes. The check could not be cashed without both owners agreeing on who would get how much.

That's why the parties should agree before the closing. And if they can agree before closing, I would suggest separate checks.

I suppose, however, that Lisa is thinking that, if they cannot agree, a single check would prevent either party from getting anything until they come to an agreement.

Quote:

Originally Posted by joypulv

Doesn't that require the cooperation of the other owner?

No. The requirement, at least in NJ and I believe everywhere else, is that the sellers' proceeds check is made payable to ALL of the sellers. If the sellers want separate checks then ALL of the sellers have to agree in writing how the checks should be made out. My suggestion to the OP is just something to reinforce that general rule, just in case the other owner requests separate checks and the closing agent doesn't request confirmation from the OP.

,b

Quote:

Originally Posted by AK lawyer

I suppose, however, that Lisa is thinking that, if they cannot agree, a single check would prevent either party from getting anything until they come to an agreement.

That is exactly the case. And that is how it should be. If they can't work it out before the closing then they'll have to work it out after. At least having a check in hand that can't be deposited will be some incentive for them to get it worked out.

As co owners shouldn't you split the cost of repairs/remodeling? I would think you could make the receipts an attachment deducting half of that from their share?