There may come a time when you need to sell the real property of a deceased family member. That can be an emotional and stressful experience further complicated by the probate process. Hiring an experienced and trustworthy real estate agent makes for a smoother transaction where they support you throughout the selling of the real property and the inherited proceeds.
What Is Probate?
Probate is the process of distributing the assets of someone who has passed away. These assets may include bank accounts, financial investments, and real property. If the deceased person has a will naming the executor, then the executor is responsible for administering the will. An administrator is usually named to complete the probate process if there is no will. In that case, a probate court commonly reviews the assets and provides a final ruling on the division and distribution of assets to beneficiaries.
Probate Process With a Will vs. Probate Process Without a Will
A will typically designates an executor or legal representative responsible for locating and overseeing the deceased’s assets as instructed in the will. The probate process is more straightforward here as the executor helps to distribute the assets.
The probate process for a deceased person without a will is much more complicated. The distribution of the assets then follows state laws. The administration of these assets will fall under the probate court’s supervision in the place where the deceased person lived at death. The exception is real property. The probate process for real property may need to be extended to counties where the property is located.
If you’re planning to sell the real property during probate, you will need to satisfy specific procedures of the probate process. Working with a real estate agency with probate experience can help you sell the property at a price and within a timeline that benefits all parties involved.
Probate Property Sale Procedures
For the sale of real property, the probate process differs depending on whether the deceased person left a will. That will determine whether the probate court grants you independent or dependent administration rights. Here’s a brief explanation of how each process works:
Independent Administration
An independent administration is usually granted if there is a will or if all beneficiaries agree to it. In this case, the probate court gives more freedom to the executor to follow through with administering the will. The executor is not closely supervised by the court and does not need preapproval for transactions, such as selling real property. It’s imperative to work closely with an attorney and a real estate agent to avoid a breach of fiduciary duty.
The probate property sale is similar to that of a traditional property sale. You, as the executor, can set the list price, list the property on your timeline, and accept an offer without needing approval from the probate court. However, there are still regulations you must adhere to specific to a probate sale, including setting up the proper probate contracts, listing the home as a probate property, and making disclosures specific to probate.
If you do not satisfy all these details at your final probate hearing, the probate court judge may ask you to redo the paperwork and reschedule a new hearing to close the estate. By working with a real estate agent knowledgeable about the probate process, you can avoid these costly mistakes that further extend the probate process.
The agent can help you with all the procedures in a traditional real estate sale, like finding a reasonable listing price and negotiating offers on your behalf. In addition, the agent can also advise you on specific probate details.
Dependent Administration
If the person dies without a will, the estate is distributed according to state laws, and the probate court defaults to a dependent administration. In this case, the court must approve all actions that are done by the administrator, which can lead to an extremely lengthy and costly probate process. The probate court oversees all transactions in the home sale. The court may require that you hire a probate real estate agent to support you in the real property sale, as there are specific rules under state law.
You must list the house at a price of at least 90% of its fair market value. At this point, having the right agent can help you determine what this value is. Once you receive and accept an offer, you must present it to a court confirmation hearing for approval. The probate judge may not automatically approve the accepted offer. Instead, the court may enter a probate auction where they consider higher offers from other buyers at the hearing. A real estate agent can help you with the bidding war by attracting other buyers to the hearing to bid on your property.
The Right Agent Can Help All Parties Involved
There are significant differences between standard home sales and probate home sales. The latter can take much longer to close and conjure uncertain feelings in both the buyer and seller, especially as the process drags on. A probate real estate agent can help you navigate the process by providing guidance on state probate laws and working with the probate court on setting a listing price and sales timeline. By working with an experienced agency like Michael Carr & Associates, Inc, you can rest assured that you, the beneficiaries, and the court receive the maximum price and proceeds for sale.
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Michael Carr is the Co-Founder & COO of BrandFace, LLC. He is also a real estate branding expert and international bestselling author. As America’s Top Selling Real Estate Auctioneer, he has sold billions of dollars in commercial and residential properties.