What is better, selling or terminating the condominium?

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In the event of divorce or inheritance, the question is inevitable: what is better, selling or terminating the condominium? We already told you that one option is not better than the other, and that selling the apartment or carrying out the extinction will depend on the interests at stake.

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What you need to know about condominium termination
Before reflecting on what is better, whether to sell or terminate the condominium , it is essential that you are clear about what extinction is.

Also called condominium dissolution , it is a legal procedure by which the co-ownership of an asset is undone. Naturally, the situations in which it makes the most sense to terminate the condominium Cayman Islands Phone Number List are inheritances and divorces. These are cases in which the property has several owners, but perhaps only one wants to keep it.

Recommended reading:   Is it better to sell a property at the end of 2023 or in 2024?
How is a condominium dissolution carried out?
Through a public deed before a notary . All you have to do is make an appointment and present your identification documents, a home appraisal and the deeds to the house. Once the process is completed, the dissolution of the condominium must be registered in the Property Registry.

If it is a divorce, this entire process can be avoided by including the agreement in the Regulatory Agreement .   

When is it best to sell and when is it best to terminate the condominium?
The answer is very simple. The home must be sold through divorce or sold through inheritance when none of the owners want to keep it, and the termination of the condominium is carried out when one wants to keep it.

What if one wants to sell and the other doesn't? An attempt must be made to reach an agreement . Otherwise, all parties will lose. According to article 400 of the Civil Code, no owner is obliged to remain in the property. If one of the parties wants to sell, the home will end up being sold, but after a judicial process, in the form of a sale by auction and surely below its appraised value.

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Why a condominium extinction and not a sale?
When one party is going to acquire the entire property through financial compensation, the natural option seems to formalize the deal through a sale. However, condominium termination has a couple of advantages . Unlike what happens in a sale, you will not have to pay:

Not even the Property Transfer Tax .
Not even the municipal capital gains .
As for personal income tax , it will only have to be paid when at the time of financial compensation there has been an increase compared to the acquisition value.