Should You Get More Distribution from Your Sale in Lieu in Maryland?

October 1, 2025
Business Law

Property ownership with another person can be beneficial in many ways. On the other hand, it can also lead to various issues. When there are multiple property owners, the potential for disputes increases, and the law may need to get involved at some point to find solutions. One of the solutions may be a sale in lieu of partition. What is a sale in lieu of partition? It is a sale of property followed by a distribution of sales proceeds to the owners.

Lusk Law, LLC knows what you are entitled to and fights hard to get it.

What Is a Sale in Lieu?

A sale in lieu of partition in Maryland can be an effective way to resolve irreconcilable differences between property owners. It essentially results in the sale of a property owned by more than one party, after which the court will fairly distribute the funds from the sale.

Sales in lieu of partitions occur for various reasons, all involving at least one owner who no longer wants to be a property owner. For example, a brother who inherits a house with his brother may not want to be a property owner any longer.

In some cases, the other property owner or owners may attempt to buy the uninterested party out. However, this strategy does not always work. When it does not, seeking a sale in lieu may be a reasonable option.

Seeking a sale in lieu requires one of the owners to request a court to force a sale. The judge will review the case and accompanying arguments and decide whether to divide (partition) or sell the property. If the court cannot divide the property without causing injury to the parties, the judge will order a sale in lieu of partition.

For example, if dividing a property prevents one of the parties from accessing a property’s most valuable features, the judge may decide to forgo the partition and proceed with a sale.

If a sale in lieu is ordered, various steps must take place before the sale happens. The Court usually appointments a Trustee or an attorney who will manage the sale of the Property.

If you are facing a potential sale in lieu, contact Lusk Law, LLC for a consultation. Learn how we can protect your interests. Call (443) 535-9715 today for a consultation.

How Much Should You Expect From a Sale in Lieu Distribution?

The amount of money you should expect depends on various factors, such as:

How the sale is carried out
Your percentage of ownership in the property prior to the sale
Market forces
The number of parties with an interest in the property.

If the Property is sold by the Trustee at an auction, it will likely fetch less than if it is sold by a trustee. At times, the Property is sold by a real estate agent and in such cases, the agent attempts to seek fair market value and typically recover more money than an auction or judicial sale.

Of course, your percentage of ownership in a property will heavily influence the amount of money you receive. If, for example, you are currently a 50% owner of a property, you will generally obtain 50% of the proceeds after costs, unless the other owner has been paying all the expenses of the property and is seeking contribution from you for expenses you should have paid.

Various costs and fees are typically associated with sales in lieu. These are subtracted from the payout before it is distributed. Common costs and expenses in sales in lieu of partition include:

Taxes
Trustee, auction, and legal fees and expenses
County or city fees and costs.

For valuable properties or high-stakes issues, it is always recommended that you at least consult with an experienced attorney for guidance and, potentially, representation.

Strategies to Increase Your Sale in Lieu Distribution

Sales in lieu result in proceeds that are distributed according to each party’s ownership interest and adjusted based on the contributions of each party. One way to increase your proceeds from a sale in lieu is to increase your ownership percentage before the sale. As part of the negotiations between property owners, increasing your percentage of ownership could be a condition to the sale in lieu if the situation allows.

Another strategy to increase your proceeds is to keep fees and legal costs to a bare minimum. Expenses and costs rise when parties are unprepared and make paperwork and filing mistakes. Therefore, ensuring strict compliance with sale-in-lieu procedures is crucial to increasing your ultimate payout. Advice and guidance from experienced counsel will ensure that you avoid costly mistakes and delays.

Alternatives to a Sale in Lieu in Maryland

A sale in lieu is the last resort to dealing with property issues and multiple property owners. It is also the most costly, time-consuming, and intrusive option. For many, other methods may be effective in resolving their disputes.

Negotiations

You may be surprised how much property owners can accomplish through negotiation. Negotiations between property owners can terminate the issues and lead to satisfactory resolutions without selling the property.

For contentious or high-stakes situations, all parties do well to retain experienced counsel to aid in the negotiations, which should be structured and focused on specific goals. Parties should expect to make concessions and should weigh them against the consequences of selling the property. The advice of counsel will be especially helpful at this juncture.

Mediation

Mediation can save property owners time and money. A mediator will attempt to lead you and the other property owner or owners to a satisfactory resolution, which could help avoid a sale of the property. If a sale is necessary, the property will be sold on the open market, which will likely result in a higher sales price. Mediation can also help preserve the relationships between the property owners — an outcome that both parties may desire, especially if they have other dealings or business together.

Lusk Law, LLC: Advocates for Life’s Obstacles and Opportunities

If you are involved in a situation where a sale in lieu of partition is potentially imminent, you should know that you have options for protecting your financial interests. Consulting with an experienced attorney in Frederick, MD, will provide you with the pertinent counsel and protection you need.

Call Lusk Law, LLC at (443) 535-9715 today. Get the assurance, protection, and peace of mind you deserve.