Hypothetical to illustrate

Imagine you and two siblings co-own a rental house in Portland. One sibling filed a partition action asking the court to sell the property. You want to keep the house and propose to buy out both co-owners before the judge orders a sale. Below are the practical steps you would take under Oregon law.

Detailed Answer

Under Oregon law, a court hearing a partition action may divide the property in kind or order a sale and divide the proceeds. The relevant statutory framework for partition actions appears in the Oregon Revised Statutes, Chapter 105 (see: ORS Chapter 105).

1. Start with a credible valuation.

   Get a licensed real estate appraisal or a broker price opinion so you can make an informed, defensible offer. Courts and co-owners weigh objective valuation when considering whether to accept a buyout vs. sale.

2. Decide price and terms.

   Choose whether to offer a cash lump sum, assume mortgages, or offer a purchase price paid over time (note: seller-financed notes can complicate approval). State the offer as total consideration and each co-owner’s share. Include who pays closing costs, prorations, and what title will be delivered (e.g., warranty deed).

3. Document proof of ability to close.

   Courts and co-owners favor offers backed by proof of funds or a mortgage pre-approval. If you lack immediate cash, show a lender pre-approval letter or escrow arrangements to reduce the risk the court perceives in accepting your proposal.

4. Make a formal written offer to co-owners (and their counsel).

   Send a clear, dated written offer describing the price, terms, timeline, and any contingencies. If co-owners have counsel, serve counsel. Keep a record of delivery. Suggest a short deadline for response so the process moves quickly and to help preserve the chance to avoid a court-ordered sale.

5. Propose a settlement to the court if needed.

   If the co-owners agree, prepare a stipulation and proposed judgment or order for the court to sign that dismisses or resolves the partition action and transfers title according to the buyout terms. If co-owners don’t initially agree but later accept, file the stipulation promptly to halt a scheduled sale.

6. File a motion to continue or vacate a sale date if a sale is scheduled.

   If the court has set a sale date and you have an accepted offer or serious negotiations, ask the court for a continuance while parties finalize the buyout. Provide the court with the written offer, proof of funds, and any signed agreements so the judge can evaluate the proposal.

7. Close and record the transfer correctly.

   If the buyout proceeds, use an escrow or closing attorney. Prepare deed(s) and lien releases, record the deed, and make sure the court’s file reflects the judgment or dismissal. If the partition case remains open, file a notice with the court showing the settlement and asking for entry of an appropriate judgment.

8. Be ready for valuation disputes and creditor or lien issues.

   Co-owners may insist the price is too low. Creditors with liens may object or need to be paid. Address liens in any buyout proposal (e.g., pay off mortgages at closing or arrange escrow holdbacks).

Key procedural point: a court will not automatically accept an out-of-court buyout. The judge must be satisfied the settlement is fair and that all legal interests (including lienholders) are protected. If parties agree and submit a proper stipulated judgment or dismissal, the judge typically will enter it and halt the sale schedule.

Reference: ORS Chapter 105 contains the statutory framework the court relies on for partition remedies and procedures (https://www.oregonlegislature.gov/bills_laws/ors/ors105.html).

Common buyout methods and their pros/cons

• Lump-sum cash buyout: Fast and clean. Courts prefer this if you can prove funds.
• Mortgage assumption or new loan: Lets you spread cost over time but requires lender approval and credible proof of financing.
• Seller-financed note: May work if co-owners accept payments, but the court may be careful about future enforcement and security for the seller.
• Deferred or contingent payments: Riskier for co-owners and for court approval unless secured or well-documented.

What if co-owners refuse?

If co-owners reject a reasonable buyout offer, the partition action can proceed. The court may order a sale and split proceeds per ownership shares after resolving any liens, credits for improvements, or costs. You can still attempt to purchase at the judicial sale (if allowed) or bid on the property at the sheriff’s/commissioner’s sale, but rules differ by county and sale type.

Next steps you should take now

1. Order a professional appraisal (or broker opinion) immediately.
2. Consult an Oregon real property attorney to draft offers, stipulations, and proposed orders for the court.
3. Gather proof of funds or lender letters to attach to any offer.
4. Serve the written offer on all parties and their counsel and ask the court for a continuance if a sale is imminent.

Helpful Hints

• Be timely. Courts schedule sales; delay can close the window to settle.
• Use neutral valuation—an independent appraiser helps overcome objections about price.
• Put everything in writing and preserve proof of delivery to co-owners and counsel.
• Address liens and mortgage payoffs in your offer so the court can see the proposal protects creditors.
• Propose a short, reasonable escrow and closing timeline to reassure other parties the transaction will finish.
• Consider mediation early; many courts encourage or require mediation in property disputes.
• Keep communication professional and document all negotiations to make a clean record for the court.