Can an asset be legally sold dramatically below market value?

Question

Or is there some sort of fair-price clause?

Thank-you all for your informative answers. In response to your question, hexeliebe, I am reffering to a personal asset, being my house.

Answer 1

Not unless it can be proven that you sold it for an illegal reason, like to put an asset in someone else's name immediately before filing bankruptcy, for example. You can sell your own property for whatever price you want, or you can give it away.

Answer 2

Yes, but....

You will not be able to pass clean title to your purchaser unless the price is sufficient to satisfy any and all liens (mortgage(s), judgments, mechanic's liens, unpaid taxes) against the property.

There may be a covenant recorded if the property is part of a planned development or condo. In most condos, the Board of Managers holds a right of first refusal: before you can sell to anyone, you must offer to sell the unit to the Board of Managers at the same price and on the same terms. Similar restraints can be found at planned communities, like the gated communities built by developers like Toll Bros.

Apart from that, it's your property, you can give it away if you like.

Answer 3

For the most part you can sell things for whatever you damn well like (provided you can find a buyer who agrees with it) including nothing, non-monetary payments, or whatever else you can think up.

There are some cases in which you can get into trouble for anti-competitive behaviour if you're a large corporation that is selling below market value to try to knock a competitor out of business but those laws really don't apply to individuals.

Answer 4

What specifically are you talking about? Is this a question for a trust or probate asset? Is this a business asset or just something you own and want to sell?

Answer 5

yes, you can sell your car to your mother for a dollar if you so wish.... just give her a reciept so she can transfer the title...