Inherited Property Split between Siblings

Ozbargainusername123 on 05/06/2025 - 07:12
Last edited 05/06/2025 - 10:02 by 1 other user

Anyone been in this situation, I'm currently in the process of working through inheritance.

A house has been left (mortgage free) to myself and two siblings. One sibling wants to buy myself and the other sibling out. We are all in agreeance with this and have settled on a price. The sibling that wants to buy has been to a broker and has got the ok for a loan. The broker has asked the sibling to get myself and other sibling to sign papers from a solicitor to transfer the property into their name.

This is my concern. I have zero paperwork/contract from the broker or bank? I feel like we should be given something with details of the amount to be paid. And to who/where it's to be paid? I don't really feel comfortable signing over the house without some guarantee I'm getting the money.

Financial Inheritance

Comments

  • SBOB on 05/06/2025 - 07:25
    +90

    Have not one of you three worked out getting a lawyer to draw up the agreement with full details of the exchange would be a logical idea?

    A mortgage broker isn't the one that should be dictating how assets are distributed, they just want the property under your siblings name so the mortgage can be fully placed against the property.

    Signing over the property before having legally agreed upon terms of exchange seems like an awesome way to learn a valuable but expensive life lesson though.

    • Ozbargainusername123 on 05/06/2025 - 07:51
      +12

      Yeah I agree. I suggested we need to go though a solicitor.
      I also I agree the broker just wants the property in the siblings name so everything is fine from their end and they get their cut.
      I didn't sign anything.

      • sponson on 06/06/2025 - 16:41
        +3

        A conveyancing solicitor/property lawyer would be ideal. Someone who can brief you on all the legalities and draw up any neccesary documentation but also follow through with the rest of the process. Cost you a bit more but worth the peace of mind.

        • infinite on 06/06/2025 - 20:51
          -8

          Also an FYI for OP:

          An average cost for this sort of situation is anywhere from $350 an hour to $600 an hour and it's likely to be between 15-30 hours worth of work depending on how many times the three of them will need to meet with the chosen property lawyer and then how much documentation they'll need to draft, finalize and then file.

          Will be money well spent, too.

          • JakeyJooJoo on 07/06/2025 - 04:54
            +2

            @infinite: Have been involved 2 property transactions in recent years, and the legal fees were lower than what you're saying, both around 3K.

            OP situation isn't complex, should be less than 4K.

            • infinite on 07/06/2025 - 17:27
              -2

              @JakeyJooJoo: I'm a property lawyer by trade.

              Conveyancer's cost a fraction of what property lawyers do and in most scenarios a conveyancer is all that's needed for a property settlement. You more than likely only ever dealt with a conveyancer.

              OP will need the services of a property lawyer, who will also be engaging the service of a conveyancer to execute the settlement….. IF they wish to make sure it's done properly.

              OP is technically free to do it all themselves with their family members and engage no one at all if they want. I would not advise OP to follow that path though.

  • Porker on 05/06/2025 - 07:26
    +32

    You should get a solicitor or conveyancer to manage the sale.

    Even though it's family, if you want to protect yourself you should still treat as a transaction with any other buyer. That is, you wouldn't hand over the house without having someone check all the paperwork etc

  • CheapandUsed on 05/06/2025 - 07:42
    +3

    What are the tax implications of this transaction?

    Inheritance, sale of assets, and tax can be a complicated nightmare at the best of times.

    • Save 50 Cent on 06/06/2025 - 06:20

      No complications if you just don’t tell the taxman about it. Works every time.

    • Inertia-g on 06/06/2025 - 07:41
      +1

      If it is sold under the estate there are no tax implications. If the title has already transferred to the siblings, there may be tax implications.

      • SlickMick on 06/06/2025 - 09:00

        Assuming it was the deceased PPOR, I don't think that was mentioned??

        • kiitos on 06/06/2025 - 11:28
          +1

          Yes, this is an important point, as well as the time that has elapsed between the owner passing away and now.

  • racer1234 on 05/06/2025 - 09:25

    You need someone to draw up a sale contract. Solicitor would be a good start.

  • jv on 05/06/2025 - 09:36
    +2

    What did your solicitor say?

    • Protractor on 05/06/2025 - 10:22

      I need a new yacht?

      • jv on 05/06/2025 - 10:30
        -4

        In the Mediterranean…

        • AndyC1 on 05/06/2025 - 20:14

          Which TV season was it on?

  • MS Paint on 05/06/2025 - 09:37
    +13

    All siblings have to pony up and get legal and taxation advice. These scenarios can go pear shaped real quick.

    • 87percent on 05/06/2025 - 09:57
      +13

      nothing splits up a family quicker than money

      • Protractor on 05/06/2025 - 10:21
        -1

        Not even an egg sambo eating competition?

        • surg3on on 06/06/2025 - 18:39
          +9

          Maybe a beef wellington.

      • Ozbargainusername123 on 05/06/2025 - 10:31
        +9

        Absolutely.
        I told my sibling it's not that I don't trust you. It's that I don't trust the broker or bank. They are in it for their own self interests. And they won't give a shit if something goes wrong.
        Having problems with this amount of money will absolutely cause irreparable issues.

      • eek on 06/06/2025 - 12:27

        This! One of the guys I used to work with was in a 7-year (and ongoing) legal battle over their parent's various estates. He's spent well over $150k in fees to fight it out as the siblings couldn't agree on whether to keep, sell, how to split etc. This is a guy in his late 50's on a $400k base salary. Good luck. Rich people's problems I guess.

        • kraigg on 08/06/2025 - 07:55

          That's rough! I'm assuming neither parent left a Will?

  • star-ggg on 05/06/2025 - 10:11

    not sure about tax but definitely need to pay stamp duty when land title modifies the deed

    • Ozbargainusername123 on 05/06/2025 - 10:38
      +7

      The new sibling owner will be responsible for the stamp duty. We discussed that. But, I want/need that to be written in a legal document.

      • Protractor on 05/06/2025 - 10:55
        +2

        Get as much of the expectations and outcomes you all want written down first. That will save time at the solicitor/lawyers, and literally you end up on the same page. Just present the legal stuff that results to all stakeholders to approve, before you all sign off.
        TLDR
        Know what you all want, and reach and write that agreement down before attending the solicitors.

      • Danstar on 05/06/2025 - 10:57
        -1

        Stamp Duty:

        Generally, stamp duty is not payable when transferring property to beneficiaries as part of an inheritance

        • djkelly69 on 05/06/2025 - 11:21
          +5

          It won't be payable when the 3 siblings get their share from the estate as beneficiaries, but it is when the 1 sibling then acquires the other two shares/rest of the property.

          • Ozbargainusername123 on 05/06/2025 - 11:58
            +3

            @djkelly69: This is correct.
            A way to avoid this, if you have enough funds, would have been to leave it in only one child's name. If it were in only one name you don't need to pay stamp duty. And to leave the other siblings with savings, shares, super or other funds that equate to the value they would have got if it were split.

            • Niche on 05/06/2025 - 12:48

              @Ozbargainusername123: Did not know this! A valuable tax saving! Thanks!

            • dtc on 05/06/2025 - 14:28

              @Ozbargainusername123: You dont even need to be this specific. Just say the estate is split equally and then one of the beneficiaries can choose to take the house and the others can choose to take other assets.

              • Ozbargainusername123 on 06/06/2025 - 06:31

                @dtc: Na , this is wrong. This is the situation I'm in. The estate was left to three children to be split evenly. One wants the house but it's in all three names. So to get it in one name you got to pay stamp duty.

                • dtc on 08/06/2025 - 19:17

                  @Ozbargainusername123: The house can’t be ‘in three names’ until it’s distributed and formally transferred. Until then it’s owned by the estate. There is no rule that says the house must go to all three, the house can go to one and other assets to the others

                  unless there are no other assets in the estate and then the only one that can be distributed is the house

            • Some Guy on 05/06/2025 - 17:03

              @Ozbargainusername123: The problem with this is that some assets may be GCT exempt and others will trigger GST when/if sold. Equating the values will be very difficult.

              This problem will become quite common in the near future as boomers with say, two kids, a PPoR and an IP, start to die. Especially if rent from the IP was used to top up retirement income of the deceased. The PPoR is a GCT free asset and will remain so if the beneficiary uses it as their PPoR. They could also then sell their own PPoR tax-free. And someone will inherit a CGT issue, when/if the IP is sold, or will receive an income-producing asset that comes with management responsibilities. So it might not be as easy, potentially unfair actually, as just leaving specific assets to specific beneficiaries, like one house to each sibling.

      • Ponsonby on 05/06/2025 - 11:33

        Drawing on own experience - Have you checked CGT? Was the property purchased after 1984? How long between date of death and the expected date of contract for sibling to buy you out? Has it been rented out since date of death? What about land tax? who is going to pay the rates, insurance etc in the interim? Are there deferred rates to pay?

  • tenpercent on 05/06/2025 - 10:55
    -2

    A little birdy tells me it's not even possible to have part ownership of a property with someone else unless you're married.

    PS. Don't believe strange birds.

  • emblurr on 05/06/2025 - 11:12
    +2

    Interested, going to have similar situation with two siblings one day. But the property will be worth too much to buy each other out.

    • Save 50 Cent on 06/06/2025 - 06:23

      Don’t be so sure mate.

    • GaryQ on 06/06/2025 - 09:03
      +1

      Kill your least-favourite sibling now, and go halves with the survivor

      • McFly on 06/06/2025 - 14:00

        ¿Por qué no los dos? 😉

      • Muppet Detector on 06/06/2025 - 15:31
        +2

        Why stop at one?

    • capslock janitor on 06/06/2025 - 13:04

      whats all yours plan with the property ?

      • emblurr on 06/06/2025 - 14:01
        +1

        I think we're going to have to sell it and split up the costs. Unless we all lived here and declared it as primary residence, then the land tax will kill us.

  • ramb9 on 05/06/2025 - 11:30
    +1

    If I was in the same situation with siblings, i'd probably try to work a tax-free'er option for all of us?

    • JimB on 05/06/2025 - 16:35

      Tax isn't an issue if the property was your parent's PPOR (e.g. not an investment property).

      Stamp duty will be an issue if transferring post estate.

  • joka on 05/06/2025 - 12:02
    +6

    You need to ask your siblings to meet in a well lit area when the transaction occurs, maybe in the police car park.

    • capslock janitor on 06/06/2025 - 13:04
      +1

      must be paid in cash too. briefcase may be required

  • dtc on 05/06/2025 - 14:31
    +1

    There should be a contract of sale, just a standard form that any conveyancer can create. This contains various legal rights and obligations including (for example) that after the date of sale you have no ongoing liabilities.

    The deed of transfer, if that is all you use, should also have the purchase price on it because that is how stamp duty is assessed.

    You dont all need different lawyers, in situations like this you can generally all have the same lawyer. So its only a few $100 each.

    • penting on 06/06/2025 - 15:57

      also need independent valuation for stamp duty purposes for the state revenue office.

  • Nutrino on 05/06/2025 - 18:40
    +2

    trust no one.

    • Ozbargainusername123 on 06/06/2025 - 06:42
      -1

      True.

      • Protractor on 06/06/2025 - 10:22
        +2

        Trust me. I have magic beans

    • blldzd on 06/06/2025 - 15:29
      +1

      This sounds like such a sad way to live your life. I feel bad for anyone that genuinely believes this.

  • garetz on 05/06/2025 - 20:12

    Happened to one of my parents and the siblings, what they did was get all the paper work done paid by the sibling buying the property from the other siblings, each sibling had a solicitor look over the paperwork, get a witness while everyone signs at the same time. The money goes to an escrow, then when everything has been verified by the escrow the money goes to the siblings who sold.

  • AndyC1 on 05/06/2025 - 20:15

    Sounds like something dodgy. Get a solicitor as everyone is saying.

  • NanoDuke on 06/06/2025 - 10:01

    Have you been granted probate? What is the wording in the Will? Do you have an estate solicitor working for all three siblings equally? Has the title been transferred yet, or is it still in the estate?

    If the Will states that the estate, house included, is to be divided equally by the siblings, then the outcome should be pretty straightforward, especially if the house is still in the estate. The value of the house goes into the pool of $$ and the executor(s) can divide it up as per the instructions of the Will. The grant of probate is the protection to the beneficiaries. You shouldn't have to get any other special paperwork drawn up.

    If ownership of the house has already been transferred to the siblings as joint owners, then you might each have to get specific advice to move forward.

  • lonewolf on 06/06/2025 - 10:40

    How close are you with your siblings? There is family and then there is family.

    • Protractor on 06/06/2025 - 12:57

      Manson family 'close'

      Also yr Username fits^

  • BartholemewH on 06/06/2025 - 12:41

    Just have the solicitor that handles the estate act on all of your behalves for the conveyancing?

    I am currently dealing with split of properties in an estate at the moment. If one of us were to buy the others out (could happen) the same solicitor will handle it.

    Stop adding additional stress, use the most obvious path to success for all parties.

  • Hangryuman on 06/06/2025 - 13:16

    a solicitor probably won't advise you on tax concerns

    OP -please provide more info -
    was it the deceased's PPOR,
    was it used as an IP - if so, between what dates,
    how long ago did they decease,
    what is the current title (deceased as sole proprietor?),
    has it passed through probate,
    who is the executor (if one of the children this could get … 'interesting'),
    there may be other questions others can ask …

    then we could provide better info about stamp duty and CGT and such

  • Dreamcast on 06/06/2025 - 14:35

    Don't do it. Sell it and split.

  • buckerooni on 06/06/2025 - 15:43

    in a similar situation but we have agreed to sell the property so it's simpler. We have an estate account controlled by the solicitor but using a standard conveyencer.

  • trevor99 on 06/06/2025 - 17:08

    Use a deed as executors to alter the Will so 1 get's the property and the other 2 get x dollars or whatever from the 1st. Simple.

    • Maneki Angel Fund on 06/06/2025 - 18:15

      Interesting, but I would be interested to know if this in effect is like a sub-sale and whether stamp duty is owing.

      Have you done this before?

      This seems like a good way to avoid the stamp duty provided Revenue NSW does not get a copy of the will and find out there is a discrepancy in what is in the will.

      *Note: Person I am replying to is in Melbourne, so the equivalent is State Revenue Office Victoria.

      Maybe what you can do in each state is different too… I did a bit of searching and found this type of deed is not effective in some countries.

      • trevor99 on 08/06/2025 - 00:52
        +1

        Yes it was done recently in Vic, executors have the authority if agreed all round. No stamp duty as it's distributed from the estate.

  • Maneki Angel Fund on 06/06/2025 - 18:08
    +1

    I have done this before and what the solicitor did was draft a simple contract which was literally only the NSW law society's standard contract but with no attached prescribed documents. On that contract will be the price you will be paid.

    At a minimum you will want this.

    I also had to sign a document to waive/acknowledge that there was a conflict of interest and the same solicitor was acting for both parties. The total cost was around $500 at the time as there were no additional disbursements.

  • The Hunted on 06/06/2025 - 18:27

    "The broker has asked the sibling to get myself and other sibling to sign papers from a solicitor to transfer the property into their name."
    Good advice from the broker, all three of you need to organise a solicitor.

  • Trying2SaveABuck on 07/06/2025 - 11:07

    Get a laywer to do this not a broker? For a few 1000 dollars you will sace yourselves any heart ache and infighting

  • Muppet Detector on 07/06/2025 - 15:56
    +1

    Hard to believe that we've made receiving a gift so difficult and expensive, eh?

  • kzrocky on 07/06/2025 - 19:14
    +3

    Dont do it.
    Ive been in this situation, I wanted to buy my mums house and offered my sister the market rate minus $30k (agents fees etc) it wasnt accepted by my sister because she got a real estate agent to value it, he values it 300K more than what it was worth. She then accused me of trying to rip her off. I abandoned the deal the house was eventually sold for $5k more than I offered, but after agents fees my sister was worse off. We dont speak anymore as she reckons I was trying to rip her off.

  • Brianqpr on 08/06/2025 - 10:05

    You'd need a binding contract to do this properly.

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