Detailed Answer

Short answer: In Louisiana, refinancing to buy out a co-owner typically means (1) confirming who legally owns the property, (2) agreeing on a buyout price or getting a court partition, (3) arranging a new mortgage or loan in the buyer’s name, and (4) using the refinance proceeds to pay the other owner and clear any encumbrances. You must record documents and obtain releases so only the buyer remains on title and mortgage. This article explains the common steps, legal checkpoints, and options under Louisiana law.

1. Confirm ownership and liens

Start by reviewing the deed and any mortgage or lien records at the parish clerk/recorder. Louisiana recognizes co-ownership (indivision) and community/property regimes that affect who can bind the property. Make sure you know whether the co-owner is a spouse, business partner, or unrelated co-owner. Also identify any mortgages, judgments, or other encumbrances that must be paid or subordinated in the refinance.

2. Agree on a buyout or seek partition

Ideally, both owners agree on a buyout price. Typical approaches to determine price include a current market appraisal, a broker price opinion, or a negotiated sum. If the owners cannot agree, either party may seek a judicial partition (partition action) under Louisiana law to force sale or division of the property. Because court actions take time and cost money, lenders and buyers often prefer a voluntary buyout.

3. Decide how to structure the buyout

Common structures:

Refinance in the buying owner’s name only, with the new loan paying off the existing mortgage(s) and providing cash to buy out the other owner.
Refinance in both owners’ names but have one owner pay the other a buyout amount (less common if the goal is sole ownership).
Buyer signs a new mortgage and gives the seller a promissory note secured by the property (seller carryback) if the buyer can’t qualify for full refinancing.

4. Lender requirements and qualifying

Lenders evaluate the buyer’s credit, income, debt-to-income ratio, and the property value. If you refinance in your own name, you must qualify for the full loan amount. Expect appraisal, title search, and underwriting. The lender will require a clear title or satisfactory resolution of title issues before funding. If you cannot qualify, consider alternative financing, a co-signer, or seller financing.

5. Calculate the buyout amount and closing figures

Work out the payoff: start with the agreed value or appraisal, subtract outstanding mortgage balances, closing costs, and any liens. If the co-owner has a one-half interest, their buyout is usually roughly one-half of the net equity unless the owners agreed otherwise. Don’t forget to include costs such as lender fees, appraisal, title insurance (if used), transfer taxes, notary fees, and any capital gains or tax consequences (consult a tax advisor).

6. Execute the refinance and transfer documents

At closing:

The new lender funds the loan and pays any old lender(s) to remove prior mortgages.
The buyer pays the agreed buyout sum to the other owner. That payment can come from loan proceeds or other funds.
The selling co-owner executes an act of sale or a quitclaim/codicil to transfer their interest. In Louisiana, immovable conveyances must be by authentic act or act under private signature acknowledged in some cases—many closings use a notary (notarial act) to ensure enforceability.
The closing notary or title company records the new mortgage and the deed (or act) with the parish recorder so public records reflect the change.

7. Obtain releases and update records

After closing, verify the prior mortgage is released of record and the seller’s interest in the property is removed. Keep copies of the recorded deed/mortgage and the release. If the seller had a mortgage that the refinance paid off, confirm the lender recorded the discharge of mortgage.

8. When a court partition may be necessary

If co-owners cannot agree on price, terms, or whether to sell, any co-owner may file for partition. Louisiana courts will either divide the property in kind (if possible) or order a sale and divide proceeds. Partition actions follow rules in the Louisiana Civil Code and relevant statutes; for guidance, check the Louisiana Legislature’s law search: https://legis.la.gov/Legis/LawSearch.aspx.

9. Special Louisiana considerations

Property regimes: If owners are spouses, community property regimes or matrimonial agreements can affect rights to buy out or mortgage. Consult a Louisiana attorney to confirm how marital regime rules apply.
Notarial acts: Many immovable conveyances and mortgages are often executed before a notary to ensure recordability and enforceability. Using a notary may be required based on the document type and the parties’ preferences.
Recording: Record deeds and mortgages at the parish recorder to establish notice and priority.

Key documents you will need

Current deed/title report and chain of title
Mortgage payoff statements
Appraisal or agreed valuation
Refinance loan application and underwriting documents
Act of sale, quitclaim, or other conveyance documents
Promissory notes and mortgage/hypothec documents (if seller financing)
Recorded releases of prior mortgages

When to hire an attorney

Hire a Louisiana attorney if:

The co-owner refuses to cooperate.
Title or lien issues exist.
Complex ownership structures, trusts, or marital-property issues apply.
You face a partition action or expect litigation.
You need help drafting seller-financing documents or a binding buyout agreement.

Relevant Louisiana law resources

For statutory language governing co-ownership (indivision), partition, conveyances, and mortgages, consult the Louisiana Legislature’s law search and the Civil Code sections on property and obligations: https://legis.la.gov/Legis/LawSearch.aspx. For practical closing requirements and parish recording rules, contact the parish clerk or recorder’s office where the property is located.

Helpful Hints

Get a current, certified appraisal to avoid disputes about value.
Ask the lender early whether it accepts the proposed buyout structure and what underwriting documents you must deliver.
Collect written payoff figures from all lenders and demand releases in writing.
Use a notary or title company experienced in Louisiana immovable transfers to prepare and record documents correctly.
If you can’t qualify for refinancing alone, consider seller financing, a bridge loan, or a co-signer, but document agreements carefully.
Keep clear financial records of the buyout transaction—who was paid, how much, and by what instrument.
Ask for recorded proof that the prior mortgage was discharged and that the seller’s interest was removed from title.
If you face disagreement, mediation can be faster and cheaper than a court partition.

Disclaimer: This is general information only and does not create an attorney-client relationship. This is not legal advice. Laws vary by situation and change over time. For advice tailored to your situation, consult a licensed Louisiana attorney.