Dissolving an inheritance community – what is important

Several heirs to a property form a community of heirs. This is naturally not the start of a long-lasting friendship, but rather something that should be dissolved as quickly as possible. Especially with real estate, this can quickly lead to disagreements and disputes. So, how can you proceed to ensure everything goes smoothly?

To be fully informed and have a neutral third party on your side, it's advisable to contact a real estate agent as soon as you become aware of the inheritance. This will prevent a forced decision due to disputes, which could result in financial losses for all heirs because the inherited property is either not sold at all or sold too cheaply. Keep in mind that all co-heirs must agree to the chosen agent.

What do we do with the property?

To decide what to do with the property, you should first have it appraised by a real estate agent. Only when you know the property's value can you make a fair decision based on realistic and market-based facts. You should ask yourself the following questions: Is renting it out a possibility? How much effort would this option entail? Or should it be sold and the proceeds divided among all heirs? Does one co-heir want to keep the property and buy out the others?

Are there any other heirs?

If heirs outside the immediate family are entitled to inherit, it can be difficult to identify them all. To reach a solution, however, the heirs must be fully identified, as each person can only dispose of their own share of the inheritance. This means that only all heirs together can decide what should happen to the inheritance. An heir hunter will locate any additional heirs for you.

If there is an executor of the will

If the testator has appointed an executor in their will, this person will handle the settlement of the estate among the heirs. The estate cannot be dissolved without their consent. In doing so, they are obligated to follow the wishes of the deceased.

How the community of heirs is dissolved

An amicable settlement is the best option. If no unanimous decision is reached, one of the co-heirs can force a partition by requesting a forced sale. This usually results in financial losses. The better solution is for the heirs to draw up a settlement agreement that stipulates how the inheritance will be divided. Most heirs opt to sell the inherited property. After all, money is easier to divide than a house and land.

Are you part of an inheritance community and unsure what to do with the jointly inherited property? We can help – please contact us!

Notes

For the sake of readability, this text uses the generic masculine form. Female and other gender identities are explicitly included where relevant to the statement.

Legal notice: This article does not constitute tax or legal advice for any specific case. Please consult a lawyer and/or tax advisor to clarify the facts of your individual situation.

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