Another way to transfer ownership rights to property and assets is through probate. This is a process whereby a probate court reviews the deceased person's will and oversees the administration and distribution of the deceased's property. The same process occurs when a person dies Intestate (without a will). This involves settling the deceased's outstanding debts, taxes, and other expenses due on the property.
The following information is provided based on Probate Property sold in California. Other states may follow different rules and procedures.
In many cases, the property left behind is sold to pay for the deceased's outstanding debts and expenses, to cover the costs incurred during probate, or to provide for the deceased's dependents. Probate sales are often a great opportunity for home buyers and real estate investors to venture into real estate as the properties are usually priced competitively in order to make a quick sale. The downside is that they are often complicated compared to conventional real estate transactions in several ways, including the following:
They may take longer
During a probate sale, the executor, the person tasked with the administration of the estate, has to follow certain steps that are different from a standard real estate transaction. For example, they have to follow state & local probate laws and any other directives from the probate court judge regarding the sale of the deceased's property. As a result, the sale may take longer than a normal transaction. The Probate process itself can sometimes take a year or longer, however when the Executor is Confirmed by the Court, the Sale of the property (home) usually can occur within 30 days (typical for a non-probate home). The critical issue there is giving a Notice to the other heirs (Notice of Proposed Action). Once issued, the heirs have 15 Days to respond; no response or agreeing with the terms of the sale means the sale goes forward. Occasionally, the Court will require Confirmation of the sale. When this occurs, additional buyers can attend the sale and “bid” on the property. The legal minimum-starting overbid begins at 10% of the first $10,000 over the accepted bid. Then you add 5% of the remaining balance of the current accepted offer. Bids after the initial one are directed by the Judge.
The estate is sold as is
In a probate sale, the executor will sell the property as is; he or she does not have to make any necessary repairs or improvements on the property and will only pay off the debts and taxes owed on the property, if any. Home buyers are advised to conduct a thorough inspection of the property to be well-informed and prepared to deal with any issues.
The executor can make improvements to the home to increase the net income to the estate, but that is at the discretion of the executor.
Benefits of a Certified Probate Specialist
They are well informed of probate laws and the procedure
Probate sales involve a lot of legal and procedural paperwork that a typical real estate agent may not be trained to handle. In addition to the regular paperwork, such as listing the home as a probate property and making disclosures, the executor will also have to file several other documents with the court over the time of the probate process, including probate contracts.
A certified probate professional will be able to handle this paperwork in a timely manner and be familiar with related documentation, including letters of administration. Hiring a certified probate real estate specialist can help avoid the many pitfalls and mistakes that can occur in this type of transaction, ensuring a smooth and fast process.
They can help in pricing properties
Property valuation is a vital part of the probate process. This is why it is important to choose a qualified professional who will be able to determine accurate values for the properties being sold. They possess the knowledge and expertise required to assess the value of properties in line with market conditions as well as legal requirements. These specialists are also well-informed about the unique considerations of probate sales, including any legal obligations that may impact an estate's value.
They know how to advertise a probate property
Probate sales have different needs than regular real estate transactions. The property being sold must be listed as a probate property. Probate professionals can help in this area by posting necessary adverts on websites that can help reach a wide audience. They understand the intricacies that go into advertising a probate property, such as the need to portray the property as being sold As Is. They also have extensive professional networks that can provide referrals to potential buyers.
They are skilled negotiators
Probate real estate transactions involve many different parties with opposing interests. In these cases, the executor needs to be skilled at negotiating with all parties to achieve the best deal possible. This is where a probate real estate specialist can help; they can leverage their market knowledge and experience to negotiate the best possible price on behalf of their clients.
They can expedite the sale
Probate sales are often associated with delays due to the probate process, which is where a specialized expert can come in handy. A knowledgeable real estate specialist is well-versed in the probate laws and procedures of the state and will be able to expedite and streamline this process, ensuring a fast sale. They can also efficiently handle the necessary paperwork and documentation, which helps prevent delay-causing pitfalls. In addition, they work closely with the executor and a probate attorney to ensure all legal requirements are met.
They provide other specialized services
Certified probate real estate specialists can provide additional support to their clients. They are skilled in addressing and solving problems related to the sale of the property, including concerns about taxes, insurance, and property management. Also, they boast an extensive network of real estate professionals, including inspectors, appraisers, contractors, and title companies. These professionals are able to provide specialized services that can help make the sale of the property go smoothly.
Enlist the help of Certified Probate Real Estate Specialist
Have you recently lost a loved one and now have to handle the probate sale of his or her property? If so, the esteemed team at RCS Property Group
is willing to help. Led by Rick Smith, an experienced specialist who has been assisting clients in navigating probate and trust sales since 1986, RCS Property Group is committed to excellence. Contact Rick Smith
for more information about probate and trust real estate.