Legal Question in Real Estate Law in Maryland

Real Estate Legal Question

My home is owned by 3 parties...myself and 2 other parties. 1 party is taking out a home equity loan to give the other party $10k and I was told I need to sign off on the loan since my name is on the title; however, I don't wish to sign because I'm not sure if this loan will affect me being bought out of the home at a later time? Does the home equity loan need to be paid in full before I can be bought out? Also, there's a possibility 1 party will not buy me out because we cannot settle on an amount. He refuses to have the house appraised and I may have to take him to court. In the past, he verbally agreed that I was not responsible for my portion of annual taxes, but I did not having anything in writing. Now he's trying to deduct back taxes from 8 years ago until present from the buy out amt. How will this play out in court if he presents receipts showing that he has paid all taxes?


Asked on 4/19/07, 2:10 pm

1 Answer from Attorneys
Robert Sher Wagshal and Sher

Re: Real Estate Legal Question

You should not sign off on the home equity loan without an agreement that the loss of equity occasioned by the $10k loan will not affect your equity in the property. Example-assume the property is worth 250k and the existing mortgage balance is 130k. Your equity share in the property is 40k (250-130/3). If your partner borrows 10k from the equity line, your equity is reduced by 3333. Given the seemingly strained nature of your relationship with your partners, you would be smart to insist on a written agreement that protects you as indicated above.

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Answered on 4/19/07, 2:33 pm


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