Buying Out a Sibling or Co-Heir's Share of an Inherited House in Tennessee

Heirs usually end up owning the house together, each with an undivided share: a percentage of the whole, not a particular room. Without a will, Tennessee's intestacy statute sets the shares (T.C.A. § 31-2-104). With a will, it usually says who gets what.

If the estate is open, ask your attorney whether the buyout should run through the estate or directly between the heirs. See can you sell a house during probate in Tennessee?

1. Agree on what the house is worth

This is where most of the discussion happens. Common ways to set a value:

• A professional appraisal. An independent number that's hard to argue with.
• A broker's opinion of value from a local agent.
• A written cash offer. Useful as a floor, because it's what the house would bring as-is, now.

Some families average two numbers. Others agree in advance to accept an appraiser's figure. Agree on the method before the number comes back.

2. Decide what comes off the top

• Any loan on the house, which the buying heir usually pays off or refinances. See what happens to a mortgage or reverse mortgage after death in Tennessee.
• Money one heir has already put in for taxes, insurance or repairs since the death. Some families credit it back; others don't.
• Selling costs the family avoids by not listing. Some families split that savings.

Put whatever you agree in writing.

3. Calculate each share

In the simplest case, each selling heir gets their percentage of the agreed value after the agreed adjustments. The title company can lay out the math.

4. Line up the money

The buying heir pays with savings, a loan, or both. If there's a loan, talk with a lender early. It will have its own requirements for title and paperwork.

5. Close at a title company

The selling heirs sign a deed conveying their shares to the buying heir, and the title company handles the money and recording. It will want the same proof of ownership as any inherited-house sale, such as letters, a muniment of title order, or an affidavit of heirship (T.C.A. § 30-2-712). See do you need probate to sell an inherited house in Tennessee?

For how a buyout affects each person's taxes, see taxes on inherited property in Tennessee and ask a tax professional.

• Use neutral numbers. An appraisal or a written offer keeps it from being one sibling's word against another's.
• Set a deadline. If the buying heir can't line up the money by a set date, agree now on what happens next, such as selling the whole house.
• Let a third party relay numbers if conversations get tense. The title company or attorney can help.

Outside buyers rarely want just one heir's share of a house, so in practice the choices are a buyout among the heirs or selling the whole house together.

Any co-owner can ask a court to divide the property (T.C.A. § 29-27-101), and because a house can't really be split, the court may order it sold (T.C.A. § 29-27-201). It's slow and costly, and most families treat it as a last resort. Talk with an attorney if you're there.

Even when the family plans a buyout, a written as-is offer is useful as a value check next to an appraisal, as the fallback if the buyout deadline passes, or as a clean exit if the heirs decide to sell the whole house after all. A cash offer is typically below full retail, so it works best as a floor. See how cash home offers are calculated.

Do we need an appraisal?

Not in every case, but it's often the fairest way to set a number everyone trusts.

Can I force my siblings to sell?

A co-owner can ask a court for partition, which may end in a court-ordered sale. Talk with an attorney first.

A written as-is offer gives every heir the same number to look at. Get your free cash offer, or read how it works.