Legal Question in Real Estate Law in Maryland

Joint ownership of a property at a loss.

I purchased a house with my sister one year ago for $400K. My sister placed $40K as a down-payment. Her and I split the mortgage, utility, homeowners association fees, etc. payments equally (50/50) during the year. The estimated value for the house today is $360K. I am interested in getting my name off the mortgage/deed. My sister will retain ownership of the house. As such, she will have to re-finance. Legally, do I owe my sister 50% of the initial down-payment and the 'unrealized loss' (variance between the sales price and the appraised property value)? Said otherwise, are both owners in a joint ownership arrangement liable for the down payment even if the house has not sold? Is it customary for the individual requesting to be taken off the mortgage to pay half of the house's loss?


Asked on 5/22/09, 10:54 am

1 Answer from Attorneys
Robert Sher Wagshal and Sher

Re: Joint ownership of a property at a loss.

Whether or not you reimburse your sister for part of the down payment is strictly dependent on whatever agreement you and she make about this. There is no "rule" generally pertaining. It would have been a good idea for the two of you to have discussed this, and even better to have executed a written agreement, prior to buying the property, but there is no reason the two of you can't try and work it out now.

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Answered on 5/22/09, 11:14 am


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