Inherited Property: How to Sell and Avoid Costly Mistakes
If you’ve inherited property from a loved one who is now deceased and you want to sell that property, you need to make sure you’re handling the sale the right way. That way you can find a buyer, complete the sale, and avoid costly mistakes. Luckily, selling probate real estate doesn’t have to be difficult. With proper knowledge and the right people on your side, your transaction can go smoothly and you’ll be able to sell the property and move past this loss. Before you get started on the sale of the property you’ve inherited through probate, consider all of the legal and financial angles so you can be prepared for anything that comes your way.
Hiring an Attorney
Whether you need an attorney or not will generally depend on the complexity of your transaction and whether you want to spend the money for the advice. However, having a quality, a well-versed attorney can be key in reducing the chances that you’ll make an expensive mistake. It’s important to think carefully about whether you want that help and representation because, while your attorney won’t work for free, they could cost you significantly less than a legal mistake would. This is especially true for a large estate.
Getting a Real Estate Agent
When you choose a real estate agent to list and market the property, select one that’s very familiar with probate and inheritance matters. That way you’ll have another good professional on your side, and that can give you peace of mind. Choosing a real estate agent for a probate transaction should be approached differently than when choosing one for a more standard sale. By finding an agent who has the type of experience you’re looking for, you may be able to get the sale to close faster and with less stress. Trying to sell the property yourself generally isn’t a good idea.
How Much Involvement Will the Court Require?
The court will be involved in the sale. You can’t go through probate without it, and there will be letters issued and hearings required that will mean some court dates and filings. If you have an attorney to handle the process for you, you’ll have less to stress over, but you can also handle it yourself if you would prefer to do so. While court clerks can’t advise you on filling out forms, because that would be providing legal advice, they can tell you where to find the forms and how much it costs to file them. Most forms are relatively self-explanatory.
Do You Have to Notify People?
Notification is a big deal in the probate real estate world. If you’re selling probate real estate in Washington D.C., you’ll need to publish a notice that the property will be sold. The same is true if you’re selling probate real estate in Maryland and Virginia; just about every state requires that you give notice. Generally, the notice of sale must be placed in at least one newspaper, for a specific period of time. That gives heirs and creditors the chance to come forward and make any claims against the proceeds of the property that’s about to be sold. You can also notify heirs directly, but that won’t stop you from needing to place a notice in the paper.
Making Repairs to the Property
Often repairs, improvements, and renovations need to be done to the property before it can be sold. If that’s the case, you want to make sure you hire trusted professionals who understand the probate process and will do things the right way. Both best-selling authors Marc Cormier and Tania Ivey are well-versed in selling real estate through probate, and they understand the value of having the right people on your side. By working with contractors who will agree to be paid from the proceeds of the property sale, you won’t have out of pocket expenses to deal with on top of everything else. That can provide a big sense of peace of mind, along with financial relief.
What if the Mortgage is Too High?
In some cases, the property you inherited has a mortgage on it. That mortgage may be higher than the value of the property itself, but you can’t be held responsible for paying the difference. Instead, you can see about doing a short sale so the property can still be sold. If there are other assets, these may also have to be sold to satisfy the mortgage. A good attorney who handles estates can help you through the process if a short sale or other non-standard types of transaction is needed. You have options, and it’s important you explore those choices before agreeing to anything or signing any documents.
Dealing with Family
Some of the trustee and personal representative responsibilities during probate include dealing with matters that are more personal than just finances and real estate. Family members may be interested in renting the house, living in it, or even buying it from you. It’s possible some of them may not feel good about the fact that the property was willed to you. Be prepared for challenges and arguments, but don’t back down. That can be a very costly mistake and a problem that you’ll need to deal with for a number of years. If you want to sell the property, you should do so. Then you can decide what to do with the proceeds from the sale and whether you want some of that money to go to other family members.
Handling the Insurance Company
One business you’ll need to contend with is the insurance company. Insurers generally don’t like keeping coverage on homes that are vacant, because the risk of break-ins and other damage is higher when no one lives there. Avoiding high insurance premiums for a property you aren’t going to be living in becomes another good reason to sell the property as soon as possible. Just be sure the insurance company knows that your loved one is deceased and that there is the right kind of insurance on the property until it’s sold.
Disbursing the Funds
In general, you can sell the house even if there may still be claims in the future. Liquidating assets in probate include the selling of real property that belonged to the deceased, so waiting months or even years for someone to make a claim on some of the proceeds is not realistic. However, once the house is sold there may be a hold placed on the proceeds. That’s typically six months, but some jurisdictions could be different. Once the hold time has expired, the proceeds from the sale of the property will be properly distributed to all of the heirs as named in the will and anyone else who came forward and made a valid, verifiable claim on the property. At that time, the sale of the inherited property and the probate process for that sale are fully complete.
How Do I Sell Real Estate During Probate?
Dealing with probate can be a difficult time in life. The loss of a loved one is generally hard, and then there are a lot of loose ends to tie up, too. That can make things feel even more overwhelming and can leave you with a feeling of not knowing where to start. Part of the process may involve selling probate real estate, along with liquidating assets in probate that aren’t designated as real property. By following the right steps, you can handle all your trustee and personal representative responsibilities during probate, allowing you to move through the process and get everything sold the right way. That will keep the process as fast as possible and also help ensure that you don’t make a costly mistake while you’re liquidating the assets of the deceased. The steps you’ll need to take can vary from state to state but will be similar in all jurisdictions.
Have an Appraisal
Among the first things you need to do in order to sell real estate in probate is to have an appraisal done on the property. That way you know what it’s actually worth. If it has a mortgage on it, you can use that appraisal to decide whether a short sale may be in order. For homes that don’t have mortgages, an appraisal confirms that you’ve done your due diligence and that you’re going to be asking a fair price for the home. That can lower your liability if other heirs don’t think you’re asking enough for the house in order for them to receive a fair share.
File a Court Petition
After you have your appraisal, you’ll need to get the petition paperwork from the court, complete it, and file it. Essentially, you’re asking the court for permission to sell the home. If you’re the executor of the will, you shouldn’t have any trouble proving that you’re legally allowed to sell the property. If you have concerns or a unique situation, or you would just feel better with some representation, you may want to hire an attorney to help you through the process. A good estate attorney can help you handle things with ease.
Accept an Offer and Be UpFront with the Buyer
With permission obtained from the court, you’re ready to start marketing the property, as long as it’s physically ready to be sold. If it needs renovations and repairs, working with best-selling authors Marc Cormier and Tania Ivey can help you get those needed changes made and get the property sold quickly. When a buyer makes an offer, it’s important they understand that the sale is going through probate and must be approved by the court. Being upfront right from the beginning is important, so the buyer can make the right decision about the property, as well.
Petition the Court for a Hearing
Once you have an offer, you’ll need a hearing so you can ask the court to allow the sale. Hearings can take anywhere from 20 to 40 days or longer, depending on the caseload of the court. The hearing will be scheduled, and once that’s done you don’t want to wait around. There are things you’ll need to do before your hearing date actually arrives.
Get a 10% Deposit
In most cases, a 10% deposit is required from the buyer. You’ll need that deposit before the hearing because it will go toward the purchase price on the day of the hearing if there aren’t any objections to the sale or other buyers who step up to offer more money. Make sure the deposit is properly held in escrow, to protect everyone’s interests.
Advertise the Sale
Selling probate real estate comes with some requirements that aren’t part of a standard sale. If you’re selling probate real estate in Maryland, Washington D.C., or Virginia, be sure that you advertise the sale correctly. Information on the sale generally has to be placed in at least one newspaper for a set period of time. That allows other people to be notified of the sale, in case others with interest in the property want to step forward to try to stop the sale.
Attend the Hearing
With the buyer’s 10% down payment and no objections from the newspaper ad, you can attend the hearing and ask that the court allow the sale of the probate property to the buyer. Make sure you show up at the correct time and date, and that you have all the required paperwork in order. Your buyer should be there, too. That way you can answer any questions the judge might have and, hopefully, the sale will be approved without a problem.
Be Aware That Someone May Outbid Your Buyer
Your buyer may not be the only one interested in purchasing the property. If that’s the case, there may be other bidders there at the hearing. It will work like an auction, allowing other people to bid over and above what your buyer has offered to pay. If your current buyer is outbid, you’ll need to return their 10% down payment at that time. If they are the winning (or only) bidder, that 10% will go toward the purchase price of the property.
Complete the Sale
After all is said and done, and the hearing is over, you can complete the sale of the property. That will allow you to be legally finished with the probate process as far as the real estate is concerned. What happens to the property after that point is the responsibility of the buyer, and the proceeds from the sale of that property will be distributed to the heirs according to what was specified in the deceased’s will. The court will handle the distribution, and each state may be different as to how long that takes or the way in which the proceeds are disbursed. There may also be debts that have to be paid from the proceeds of the sale, and that will be done before any other money is distributed.
How to Sell a House Upside Down or Right-Side Up with a Reverse Mortgage
Selling probate real estate can take time and effort; that can all be magnified when there are mortgage concerns. For the heirs of those who had a reverse mortgage and have passed away, trustee and personal representative responsibilities during probate can include the potential for a short sale. While this type of sale isn’t always possible, in cases where it can be used, it may help get a property sold so the family of the deceased can move on.
What is a Short Sale?
A short sale occurs when real estate is sold for an amount less than what is owed on it. These sales are often done to avoid foreclosure, and the bank that holds the mortgage on the property has to approve the sale. There is generally a specific length of time in which the short sale can be completed before the bank will foreclose instead. For real estate that’s in the probate process, the goal is often to sell it quickly and move forward. A short sale may complicate that, and may not be possible if the estate has other assets that can be sold to pay off the mortgage.
Is the Property in Good Shape?
The condition of the property may affect the chances of getting someone to buy it quickly. If you find that your trustee and personal representative responsibilities during probate extend to a short sale of the deceased’s real estate, working on making the property look as good as possible could be in order. By working with best-selling authors Marc Cormier and Tania Ivey, you can focus on a quick sale of your property and get the help you need to repair and renovate. That can give you peace of mind throughout the entire process.
Do You Need an Attorney?
If you’re selling probate real estate in Virginia, Maryland, or Washington D.C., you’ll need to be sure you understand the laws and regulations that surround it. That’s especially true if you’re trying to short sale a property that has a reverse mortgage. If there are other assets, your short sale may not be allowed. If there aren’t any other assets, and the property is clearly worth less than what is owed, an attorney can help you prepare and keep good records so you have the opportunity to get through the process and put the sale of the real estate behind you.
What Are the Liability Issues?
One of the biggest issues with a short sale of real property through probate is the liability. If you can’t prove that the property was worth less than the reverse mortgage on it, other heirs could come after you legally and financially. By keeping great records, getting an appraisal, and following the advice of your estate attorney, you can reduce any liability risks you might otherwise encounter. That will provide you with peace of mind throughout the sale and beyond.
Can a Seller Accept an Offer on a House Still in Probate?
In short, yes. Sellers can accept offers on homes that are still in the probate process. However, there are rules and guidelines that have to be strictly met and followed. If you’re planning on selling probate real estate in Maryland, Washington DC, or Virginia, you’ll want to make sure you know the laws there, or that you hire someone who does. That way you don’t have to worry about meeting guidelines that may be difficult for you to follow or confusing to you if you’re not familiar with them.
How Does an Offer Work?
Normally, a potential buyer would make an offer on a piece of property and the seller would decide to accept, reject, or counter that offer. With a house that’s still in probate, though, the offer has to go through the court. The terms of the sale also have to be accepted by the administrator or the executor of the estate. If you have a trustee and personal representative responsibilities during probate, you’ll need to work with the buyer and the state’s guidelines to ensure that the sale goes through properly.
Getting the Property Ready for Sale
Liquidating assets in probate isn’t always easy. Part of the problem for many people is that the real estate that is left behind when a loved one passes away needs repairs or renovations to make it more sellable. By hiring professionals, like best-selling authors Marc Cormier and Tania Ivey, you can get those repairs and renovations made without spending money out of your pocket. The contractors who do the work on your loved one’s home will be paid from the proceeds when the home is sold. That’s one less thing for you to worry about.
Do You Need an Attorney?
Getting an attorney isn’t always necessary, but it could be a good idea. You want to make sure you’re getting sound advice, and that you’re following all the legal guidelines required by your state when it comes to making an offer on a house that’s still in probate. An attorney can ease your burden and give you more peace of mind during a difficult time. Then you can accept an offer with confidence and know that you’re doing everything your state requires so that the offer can go through and the real estate can be sold to the buyer.
Choosing the Right Real Estate Agent
You also want to be sure to choose the right real estate agent to list and market the property and take offers on it. An agent who understands how it all works and is familiar with the process is your best choice. By working with a knowledgeable professional who can protect your interests and take care of getting the property on the market and sold, mistakes are less likely and stress is minimized.
Tips and Tricks to Selling Your Estate Through the Probate Process
When someone dies without a will, their real property must go through probate. That can seem frustrating for family members who are trying to sell the property and move on, but it is necessary to ensure that the sale is handled in the best way possible and that it brings in the highest sale price for the property itself. There may be heirs to be paid and debts to be settled from the property’s sale, all of which can be coordinated to run as smoothly as possible.
You’ll Need to Go Through the Court
Selling probate real estate must be done through the state and the court system, although it can be listed and marketed through an agent in much the same way as other types of properties. As the personal representative or the trustee, you definitely don’t want to be taken advantage of as you move through the process of getting the property sold, and with knowledge of the right tips and tricks that can be more easily avoided.
Choose Your Attorney Wisely
Make sure you work with a good estate attorney. If your loved one died without a will you need the legal protection that an attorney can provide? That way you will be able to ensure that your loved one’s real estate is sold fairly and that debts and other obligations are taken care of out of the proceeds. Without an attorney on your side, you risk being cheated by people who will prey on your grief or lack of understanding of the process of probate (this could even result in the loss of the property).
How Much Work Does the Property Need?
You’ll need to focus on the condition of the property itself. There may be cleaning and repairs that should be handled. If that’s the case, work to get those done so the property will have a better chance at selling for a good price. By working with us, you can get any problems with the property corrected and you won’t have to pay anything upfront. Contractors who do the work will get paid from the proceeds of the sale of the property. Whether you’re selling probate real estate in Washington D.C., Maryland, or Virginia, we can help you with liquidating assets in probate.
Choose the Right People to Help You with the Sale
Marc Cormier and Tania are best-selling authors and have years of experience with probate real estate sales. Your trustee & personal representative responsibilities during probate may seem overwhelming, but they don’t have to be. With the right help, you can make sure your loved one’s real estate is handled fairly after they have passed away. Don’t let your grief get in the way of doing what’s right. Selling real estate through probate can be done safely and effectively, as long as you understand the process and make sure that the process is followed the right way.