FAQ: Getting Your Share of Net Proceeds After a Partition Sale in Maryland
Short answer
If a Maryland court orders a partition sale of real property, the court (or its appointed commissioner) calculates and distributes the net proceeds after paying mortgages, liens, taxes, sale costs, and court costs. To get your share you must: (1) establish your ownership interest; (2) make sure liens and expenses are properly paid or charged against proceeds; and (3) obtain the court’s distribution order or final accounting and request payment. If the other co-owners or the commissioner refuse to distribute, you can ask the circuit court that handled the partition to enforce the distribution. This article explains the steps, common issues, and what to expect under Maryland practice and procedure.
Detailed answer — how distribution works and what you must do
Partition actions in Maryland are handled in the county circuit courts. A partition sale usually occurs when co-owners cannot agree to keep or divide the property. The court can order the property sold and appoint a commissioner or direct a judicial sale. The net proceeds are the sale price minus valid liens, mortgages, taxes, broker/commission fees, closing costs, and court-ordered costs. The court then distributes the remainder according to ownership shares or according to any special rulings (for example, adjustment for unequal contributions or liens).
1. Prove your ownership share
To receive your share you must establish your legal interest — usually via a deed or chain of title. If title shows equal ownership (for example, two co-owners as tenants in common), the net proceeds divide according to those shares. If ownership percentages differ, distribution follows the recorded ownership interest unless the court orders a different allocation based on evidence (contributions, agreements, or liens).
2. Understand what gets paid before distribution
From the gross sale price the following typically get paid out first:
- Mortgages and secured liens (they have priority and generally must be satisfied from sale proceeds).
- Tax liens (federal, state, and local tax liens are generally paid from proceeds in order of priority).
- Costs of sale: real estate broker commissions, closing fees, title charges.
- Court costs and fees related to the partition action (including commissioner fees and advertising costs).
After these items are paid, the remainder is the net proceeds available for distribution among co-owners.
3. Commissioner’s accounting and court order
When the court appoints a commissioner (or a sheriff/official conducts the sale), that officer usually files a final report or accounting listing the sale price, payments made, and the balance remaining. The court reviews the accounting and enters an order directing distribution. You receive your share only after the court signs that order and the funds are available for disbursement.
4. How ownership disputes, claims, or offsets affect your share
If a co-owner claims that another co-owner paid more for mortgage payments, property taxes, or made repairs that increased equity, the court can adjust distributions to reflect those contributions if the evidence supports them. Also, if any co-owner has a separate judgment lien against them, that lien may attach to their share and the creditor may claim payment from the distribution.
5. If you do not get paid voluntarily
If the court ordered distribution but you are not paid, you can return to the same circuit court to enforce the order. Common enforcement steps include a motion for contempt, a motion to compel payment from the commissioner or co-owner, or writs available under Maryland procedure. The circuit court retains jurisdiction to enforce its orders.
6. Practical timeline
A partition case can take several months to over a year, depending on whether title issues, lien disputes, or appeals arise. After sale, expect 30–90 days for closing and the commissioner’s accounting; distribution follows the court’s review and order.
7. Tax considerations
Net proceeds may produce capital gains or other tax consequences. Each co-owner is responsible for their tax reporting. Talk with a tax advisor to understand capital gains calculations, basis adjustments, and potential withholding obligations.
8. Hypothetical example
Facts: A house sells for $300,000 in a court-ordered partition sale. Mortgage balance: $100,000. Real estate commission and closing costs: $15,000. Property taxes and liens paid: $2,000. Court and commissioner fees: $3,000.
Calculation: Gross sale price $300,000 − mortgage $100,000 − sale/closing costs $15,000 − taxes/liens $2,000 − court/commissioner fees $3,000 = net proceeds $180,000.
Distribution: If two co-owners own equal halves as tenants in common, each receives $90,000, subject to any separate claims or liens against an individual co-owner’s share.
9. Where to look for Maryland resources
- Maryland Courts self-help and circuit court information: https://www.mdcourts.gov/selfhelp
- Maryland circuit courts (where partition cases are filed): https://www.mdcourts.gov/courts/circuit
- Maryland General Assembly (statutes and search for the Real Property or related provisions): https://mgaleg.maryland.gov
Note: specific statutory text governing partition matters and priorities of liens is located in Maryland statutes and the Maryland Rules; check the Maryland General Assembly and Maryland Courts sites for the precise code sections and procedural rules that apply to your county and case.
Helpful Hints
- Gather key documents early: the deed(s), mortgage statements, tax bills, HOA records, receipts for repairs and improvements, and any written agreements between co-owners.
- Confirm recorded ownership percentages before distribution; if the deed is ambiguous, get a title report or court determination in the partition case.
- Ask the court for a clear accounting from the commissioner and review it carefully. Raise objections promptly in court if you see errors.
- Watch lien priorities: mortgages and tax liens generally get paid first and reduce available net proceeds.
- Consider settlement or buyout: sometimes a co-owner will buy out others for a negotiated payment, avoiding sale costs and delay.
- Preserve evidence of payments you made (mortgage payments, taxes, repairs). The court may credit you if you can prove extra contributions that increased equity.
- Be prepared for tax consequences; consult a tax professional before completing the distribution.
- If funds are withheld or a co-owner refuses to distribute, file a motion with the circuit court that entered the distribution order to enforce payment.
- Hire counsel if disputes involve complex title issues, substantial liens, or contested accounting — an attorney familiar with Maryland real property and partition procedure can protect your rights in court and with the commissioner’s accounting.
Next steps
If you are a co-owner in Maryland and expect proceeds from a partition sale, start by collecting documentation of your ownership and any payments you made for the property. Check the circuit court docket for the case, obtain the commissioner’s accounting, and review the court’s distribution order. If you have trouble getting paid what the order grants, return to the circuit court to enforce the order or consult an attorney for immediate procedural help.