Detailed Answer — How a co-owner can get money instead of physical property under New Hampshire law
Short answer: If you co-own property in New Hampshire and want money rather than a share of the physical property, you can (1) negotiate a buyout with the other owner(s), or (2) ask a court to partition the property by sale so the proceeds are divided. Courts prefer dividing property physically when practical, but they will order a sale when division is impractical or unfair. See New Hampshire law resources at the RSA site: https://www.gencourt.state.nh.us/rsa/ and the New Hampshire Judicial Branch for court procedures: https://www.courts.state.nh.us/.
Key concepts — what you need to know
- Types of co-ownership: Common forms are tenancy in common and joint tenancy. Each co-owner has rights to a share of the property but not an absolute right to force the other to take physical pieces of the real property.
- Partition: “Partition” is the legal process co-owners use to end shared ownership. A partition can be physical (partition in kind) or by sale (partition by sale). Courts will order a sale if physical division is impractical or would be inequitable.
- Buyout: Instead of court, co-owners can agree that one party buys the other’s interest for an agreed amount. Proper valuation and written agreement are critical.
How the process commonly works in New Hampshire
- Try to resolve by agreement first. Negotiate a buyout. Get a current appraisal and use it as the starting point. Put the agreement in writing and record any change of title.
- If negotiations fail, consider mediation. Mediation or arbitration can produce a fair buyout without litigation costs.
- File a partition action if needed. If you cannot agree, a co-owner can file a partition action in the appropriate New Hampshire court (the county Superior Court or other court with jurisdiction over real property disputes). The court will examine whether the property can be fairly divided in kind. If not, it will order the property sold and the net proceeds divided among owners.
- Valuation and credits. The court-appointed process will usually include appraisals and may credit or debit owners for mortgage payments, taxes, insurance, repairs, or improvements paid by one co-owner. The final cash distribution reflects those adjustments.
- Liens and mortgages. Any mortgage or lien on the property must be satisfied or addressed at sale. Proceeds are typically used to pay liens before owners receive distribution.
Common reasons courts order a sale instead of in-kind division
- Property is a single-family home or otherwise cannot be physically divided without great loss.
- Unequal ownership shares would make fair division impossible.
- Division would destroy the property’s marketability or value.
What to prepare if you want monetary compensation
- Collect documentation of ownership (deed or title).
- Gather records of mortgage payments, property taxes, insurance, and major repairs or improvements showing who paid what.
- Obtain one or more professional appraisals to establish fair market value.
- Keep copies of offers, communications about buyout talks, and any written settlement proposals.
Timing, costs, and likely outcomes
Negotiated buyouts are usually fastest and least expensive. Mediation is next best. Filing a partition action can take months to over a year depending on complexity, inventory of claims, and court schedules. Litigation brings attorney fees, court costs, appraisal fees, and possible sale costs (broker fees, closing costs).
Net proceeds after sale are split among owners according to ownership shares, adjusted for payments and credits. If one co-owner has invested more (paid mortgage/taxes/repairs), the court can credit that co-owner before dividing the balance.
When a buyout price may be higher or lower
- A willing-buyer/willing-seller market appraisal gives a baseline.
- Buyouts often discount a fair market price because the buyer must pay closing costs, buy out other owners’ equity, and may have limited financing options.
- If a co-owner forces a sale, competitive bidding at auction or on the market can produce full market value — but sale costs and timing are factors.
How taxes and capital gains affect a cash buyout
Receiving cash for your share of property can trigger capital gains tax if the property appreciated and you are not eligible for any exclusion (for example, primary residence exclusions have specific rules under federal tax law). Consult a tax advisor about timing, basis, and possible tax strategies.
Where to find statutes and local court rules
New Hampshire’s Revised Statutes are available online at the NH General Court site: https://www.gencourt.state.nh.us/rsa/. For court filing rules, local procedures, and forms, visit the New Hampshire Judicial Branch: https://www.courts.state.nh.us/. These resources provide the statutory and procedural framework for partition actions and property disputes.
Important: This explanation is a general overview. Specific outcomes depend on the facts: the form of ownership, written agreements among owners, outstanding liens, contributions, and county-level court rules.
Disclaimer: This is informational only and is not legal advice. For advice about your situation, consult a licensed New Hampshire attorney who handles real property disputes and partition actions.
Helpful Hints
- Start by asking for an appraisal — objective valuation helps negotiations.
- Document every payment you make toward the property (mortgage, taxes, insurance, repairs).
- Put any buyout offer in writing and consider using escrow to handle closing funds.
- Consider mediation before litigation; it often saves money and preserves relationships.
- Get title searched early to identify liens or claims that affect net proceeds.
- Remember potential tax consequences — consult a tax professional early in the process.
- If you anticipate court, understand the likely timeline and costs so you can weigh them against a negotiated solution.
- Consult a New Hampshire real estate attorney for tailored advice, pleadings, and to ensure you meet local filing requirements.