What to know if you want to buy or sell a home that is a probate property.
How do you buy or sell a probate property? To answer this question, I’ll use a story as an example. Let’s pretend that your brother Bob, who did not have his house in a trust, passed away. Whether he had a will or not, both cases lead to the property going to probate. The court steps in to help make decisions about who has the authority to sell.
The court appoints an administrator who can either have limited authority, which usually happens when there are disputes, or full authority. They then take on the fiduciary duty to represent the estate. There may be creditors that need to be paid off or beneficiaries that need to get their money, so the administrator can’t sell it to anyone for a dollar. Instead, they are required to make business decisions.
The property goes on the market, and the process here is pretty standard for the most part. One critical thing to note is that if you’re a buyer looking at a probate property, the seller probably has almost no knowledge of the property, so you should make sure your inspections are very thorough.
Once an offer is accepted and all contingencies are removed, you have a 15-day maturing period when the listing agent or the attorney will send out letters called “a notice of proposed action” to all the beneficiaries. If there are no objections from the beneficiaries after those 15 days, the process moves forward to the closing. However, if there were objections, things could end up in court.
The process of selling a probate property can be very smooth and has many similarities to a standard sale. The key thing when you’re selling as an administrator is that you take on the role of the fiduciary for the trust. In cases like that, we can help cover the costs. We’ve covered up to $50,000 on properties to help increase their values, and we did that free of charge.
If you have more questions about this topic or anything related, call or email me. I’d love to be your real estate consultant!