Many individuals are considered “house rich, cash poor,” meaning that their biggest asset is their house. While some of these individuals have an estate plan in place, many do not and are unaware of the consequences. Without proper estate planning, heirs inheriting a house can find themselves in a precarious situation. Fortunately, a provision in New York’s Real Property Law helps to remedy the situation.

Take the following scenario: Mom died intestate and was survived by four children. The most valuable asset she owned at her death was her house. Under New York’s intestacy law, the children inherit Mom’s house. By operation of law, the house passes to the children as tenants in common. One of the children no longer wants to be involved with the house and sells his interest to an unscrupulous third-party real estate investor.