How to Sell Your House Through Probate?
Many people probably don't know what a probate court is and its role when selling real estate property. If you inherited a property from a deceased family member and have no plans of occupying it, your first option is to either use it as a rental property or sell it for profit. Sounds easy, right? Well, it's a little more complicated than you think. This article will guide you on what you need to do if you want to sell your house with Probate.
What is a Probate or Surrogate Court?
Probate or Surrogate Court is a legal entity with jurisdiction and authority to deal with matters on the administration of a deceased's estate. They legally distribute the deceased's assets, rule the will's validity, enforce the stipulations of a valid will by issuing a grant of Probate, provide equal distribution of assets for persons who die without a will, and assign an executor for the will in some cases.
When an individual dies, all of his worldly possessions are inherited by the immediate family members. It's easy if the deceased left a spouse because then there is no question about who will inherit all of his properties. The complication lies when the deceased either left no written will or several heirs who claim the inheritance.
Selling a house through Probate is very different from selling a traditional house that you own through your finances. When a deceased person has no surviving spouse and has more than one child, the house cannot automatically belong to one person. Even with a will, the deceased estate will be assigned to a probate court, which will decide who the rightful owner will be.
When to Sell your House through Probate?
A probate is a court-supervised process wherein the heirs of a deceased person can legally obtain the physical assets promised to them through a will or equally distribute the deceased assets when he dies "intestacy" or without a valid will. The probate court keeps a close watch on the distribution of assets to prevent frauds, illegal claims, or opposing heirs.
Suppose you are an individual who has no plans of moving in on inherited property, for reasons such as location or any other personal circumstances. In that case, it's easier to sell your house after Probate when you are already the legal owner. Although you have to consider that probate ruling typically lasts from 6-10 months, and the process can cost thousands of dollars, waiting for the probate court to declare you the legal owner might also not be a good idea. If you have other siblings who also have rights to the property, then selling the house with Probate would be the most viable option.
What are the Common Mistakes of Selling a house with Probate?
Even with traditional house sales, there are many pitfalls that you need to avoid for a successful sale. Along the way, you will experience issues like finding a suitable buyer, getting the correct property value, ensuring that taxes and other obligations are paid, and many such problems. Selling probate real estate is way more complicated. If you don't avoid these common mistakes, there is a high probability that you will get less than your property's worth in the sale.
Not Hiring Professional Help
Can you sell a house with Probate on your own? You can if you want the weight of the world on your shoulders. You may think that professionals cost a lot of money, but in the long run, doing things on your own or getting inexperienced people will cost you more than you think.
Probate is a legal process, and as such, needs a competent probate attorney to manage the legal aspects. The Probate Attorney will need to draft and file your petition for Probate, collect insurance, and generally be the middleman between you and the probate court. There are legal processes involved in distributing the estate that only an experienced and licensed probate attorney can handle. Ensure that you find someone who has dealt with similar cases in the past to avoid any possible delays in procuring a Probate grant from the court.
Reputable Real Estate Agent
Aside from a probate attorney, you will also need a reputable real estate agent to settle matters like appraising for the correct market value of the property, coordinating with buyers, and handling specific required documentation by the probate court with jurisdiction over your property.
A reputable real estate agent can provide insight into a property's market value and give you a correct appraisal. Bear in mind that the value of a property dramatically differs from the seller's perspective versus that of the buyer. To establish a fair and unbiased property appraisal, you need the help of a professional.
Sell or make any changes to the property
Just because you are the next of kin doesn't mean you can start breaking down walls for a house makeover or post a For Sale sign right away. To be legally appointed as executor, you need to appear before a probate court and be formally designated by the ruling judge.
Failure to follow the Real Estate Disclosure law
This law differs from state to state, but almost all states require the owner to disclose (in writing) all material defects of the property to all interested parties. For a property on Probate, this can get trickier because heirs did not live in, and usually don't have first-hand information on the defects that they need to disclose. You must inspect the property to determine if there's a wall that needs to be reconstructed, or faulty plumbings, that you need to declare in the sale.
Keeping the house empty
The market value of a property that is not regularly maintained will considerably be less than a house in pristine conditions. If you don't have plans of occupying the property before it gets sold, then file the probate requirements right away and shoulder regular property maintenance while waiting for a ruling.
Likewise, you also cannot occupy the property before you are declared the rightful owner. A contesting heir can file an appropriate legal case against you and may affect the court’s ruling of making you the executor of the will. As previously discussed, don’t make any permanent changes on the property until after the probate case is resolved.
Can I sell a house with Probate?
The fast answer to that question is yes. However, never do it on your own. A successful sale will only happen if the right individuals handle the intricacies of probate proceedings. They can help you navigate through the legal process and prevent you from making rash decisions or spending on unnecessary expenses. Getting professional help can make or break a successful sale.