Formula for BUYING OUT A SIBLING on a mixed use building.
Hello,
I was quick deeded a building upon my mothers passing. Unfortunetly, its a mess because the building was in a relatives name and when my mother passed the relative quick deeded the building to me for a dollar.
I know its a mess.
Anyways, one of my siblings doens't want to hold onto the building and wants to be 'bought out' and so we are trying to figure out a buyout price.
there are 3 siblings total.
The building has been in my name for 5 months only. I am not gonna sell it for a bit. My sibling is looking to be bought out immediately.
The building is probably worth about 390K and has an outstanding mortgage of 20K.
When buying out a sibling, do I take into account capital gains? If so, shoud I just do the 15% since I won't be selling it till after a year.
So, I will have to refinance or take out an equity loan - ITS A MIXED USE BUILDING....units/restaurant.
Should i just divide the appraisel by number of siblings minus 15% for capital gains etc.....what is the formula for buying out a sibling?
Since I will not be making much money (about $300 dollars profit per month from the building IF I TAKE OUT AN EQUITY Loan since the building doens't generate alot of income...how should i figure buyng my sibling out...he feels he is enttiled to exactly a third, but that seems high since he can play with the money now wherease I can't...
alll advice appreciated.