Heirs property
Heirs property, also known as "tenants in common" is land that is jointly owned by descendants of a deceased person whose estate was never handled in probate court and is passed down from generation to generation. These joint owners (heirs) have the right to use the property, but none of them have a clear title. Without proper documentation and a court proceeding to clear the “cloudy” title, third parties like banks, mortgage lending companies and others have no way of knowing who is really entitled to the property and whether any creditor claims apply. This means that none of the heirs can sell, mortgage, or make any repairs the real estate without written consent of ALL the heirs.
- The land becomes vulnerable to involuntary loss through adverse possession, tax auction, or a partition-by-sale if granted by the court.
- The heirs cannot sell the property or use it as collateral for a mortgage
- The property may be ineligible for federal assistance, like USDA farm programs or FEMA support after a natural disaster
- Most potential tenants, logging companies, or other people who may wish to do business with the property may refrain due to title and ownership issues;
- Heirs may be reluctant to repair or improvement the property because every dollar spent is supposed to be divided among all of the other heirs.
- Family relationships can be ruined forever
- Precious family history and evidence of community contributions can be lost
In many situations, a landowner can inadvertantly create heirs property due to language in their will that indicates the individual wants to leave their farm equally to all their heirs. Without indicating specific surveyed parcels of land that have separate deeds, a tenants in commoon situation is created with all heirs having access to the aggregate of all land parcels owned by the person whio passed away.
Occurrences of heirs property are found in all types of landowners. In some parts of NC, the proportion of land owned by heirs is disproportionately high among racial and ethnic minority groups, low-wealth and low-income households, and other vulnerable populations who are less likely to conduct sophisticated estate planning. Relatively high rates of African American land loss during the 20th century likely contributed to the widening racial wealth gap by depleting existing assets and undermining the transfer of these assets across generations.
