I bought a house with my significant other; we were never married, and now we broke up. What happens to the house?

I bought a house with my significant other; we were never married, and now we broke up. What happens to the house?

This situation is quite common – property is often bought jointly, with both party’s names on the title. (See our blog “Ways to Take Title to Real Estate” for more info). For example, you and significant other, a sibling, or even a business partner may jointly hold title to real estate. But what happens when joint owners can’t agree? Situations like this may arise in the context of a deteriorated business relationship, a breakup, inherited property, or from frustrated interests – i.e. one party wants to sell and the other party does not. When co-owners cannot come to an agreement on their own, seeking a partition action from the court may be necessary.

What is a partition action?

A partition action is a court-ordered process in which the court orders either a forced sale of the property (partition by sale) or divides the property into separate parcels, giving each party an equal interest (partition in kind). Partitions in kind are not always possible, such as when a non-marital couple jointly own a house on a single parcel – the house cannot be divided equally, thus the court would be more inclined to order a partition by sale.

In a partition by sale, there will be a judicial sale of the property, resulting in each party receiving their fractional share. The fractional share is determined by the equity that each party put into the property. Thus, if one party put in $60K, and the other put in $40K, the sale proceeds would be distributed according to the party’s 60/40 interest. However, the court has broad powers in partitioning property and may consider other factors such as: who was making mortgage payments (or lack thereof), improvement payments, who is making more use of the property, who is paying the taxes, etc.

How can I file a partition action?

Before you can file a partition action, you should be aware of how you and your co-owner(s) hold title and examine any agreements, contracts, wills, or trusts concerning the property, which may place limitations on partition. For example, if the property you seek to partition was part of an inheritance by will, the will should be consulted to determine whether the decedent placed any limitations on the property – for example, the decedent may have prohibited a partition by sale with the intention of keeping the property in the family.

Contact us today for a consultation at 262-725-0175 or our website’s contact page. Wynn at Law, LLC is based in Southern Wisconsin and has three office locations: Lake Geneva, Delavan, and Salem.