My Partner Refuses to Buy me out and now I Having Problems Applying for a Mortgage, What Should I do?

Share the Knowledge!

“I entered into a partnership agreement with one individual to purchase rental property. During the purchase of our first and only property, I notice some red flags which I ignored. Over two years ago we purchased a duplex in Michigan and paid cash. Now I want out of the deal. My partner verbally agreed to get a Mortgage or buy me out when when purchased the property. Now he refuses to do so. The property has been up for sale for over a year but because of the market in Michigan no offers have been made. When he refused to buy me out or do a re-finance, I refused to put a tenant in the other side. One unit is occupied and one unit is vacant. The occupied unit pays the expenses with no profit to either of us. Now I would like to divide the duplex and take one unit and he take the other unit. I applied for a mortgage because I need my money from the cash sale (my partner has plenty of money and owns other property, but he refused to keep his word). I now know that verbal promises is real estate is not binding. Because there is only one deed and one tax bill I have not been able to complete the mortgage process. What do I do now, what City department do I approach to settle this issue. I need to divide the duplex (side by side) property and get a mortgage so that I can get my money back as I now am cash broke.”

[NOTE: Articles and answers on DearEsq., while written and published by lawyers, do not constitute legal advice, and no attorney-client relationship is formed by your reading of this information. You should always consult with an attorney for any legal situations.]

Unfortunately, in this situation I think you need an attorney, not a city department. Depending on exactly how the property was purchased, you may need to either dissolve your partnership or sue for partition of the property. In either case, that could be an expensive proposition, so some negotiation, with the attorney’s help, may be the better way to go.

Share the Knowledge!

Author: House Attorney

A house attorney has answered this question.