Have you ever asked, ‘’how to deal with a probate house’’? Well, probate is the legal process your estate (everything you own at your time of death) goes through after you pass away. The probate court authenticates your will during probate, and the total value of all your assets is determined. Your executor, the person you designate in your will to carry out your last wishes, is then authorized by the court to pay all debts and taxes first before distributing the remaining value of your estate to your beneficiaries.
This process can go smoothly enough if you have a will documenting your last wishes. Without a will, things get a little more complicated. It is then up to the court to appoint an executor, usually your next of kin.
Probate can take as long as a few years, depending on whether there is a will. Executor fees, legal fees, and administrative expenses are some of the costs associated with the process. The longer probate takes, the more fees there are.
A house in probate is undergoing this legal process of carrying out the decedent’s (the deceased person) final wishes regarding the house and what to do if there is no will or no heir is named in the will. Any real estate property someone owns will go through probate, with or without a will.
The only exceptions are if the property is part of a living trust, joint ownership, community property law, or transfer-on-death (TOD) deed. If it does not fall into any of these categories, it must go through probate.
What happens to a house in probate depends on whether there is a will naming heirs who should inherit the house or the deceased passed away without a will.
When there is a will naming heirs, the executor will carry out the decedent’s final wishes in probate court. A petition is filed with the court, and a date is set for a probate hearing. At the hearing, the executor is granted authority to administer the estate. The judge will then transfer property ownership to the beneficiaries, who may or may not decide to sell the house.
The decedent’s estate is intestate when there is no will to document the decedent’s final wishes. There are instances where the ownership of the house has not been transferred through a living trust, transfer-on-death deed, or joint tenancy law. In that case, it is transferred in probate court after the judge appoints an immediate family member as the executor. The court could also transfer ownership of the house to the spouse or other next of kin, depending on the state intestate succession laws.
Another possible scenario is when there are named no beneficiaries for the house in the will. The property is turned over to the court, and the closest next of kin is appointed executor to sell the property. After the property sale, the probate court splits the proceeds between beneficiaries.
If you are the executor of the estate and no heirs were named in the will, you are likely faced with the task of handling the probate sale, which can take anywhere from six months to a year or more.
When dealing with a probate house sale, the first thing to do is contact a real estate agent with plenty of probate experience. You might want to work with a certified probate real estate specialist (CPRES) to help you find an agent experienced with probate sales. It is also best to hire a probate attorney to help you navigate the legal proceedings.
Once you have an agent and a probate attorney, the court authorizes the real estate agent to sell the property. The transaction is similar to a regular home sale transaction. The difference is the court has control over the progress of the sale and will determine the sale price along with the agent and executor, sometimes with the guidance of a home appraisal.
At this point, the house is on the market, and interested buyers can make offers. Offers must be accompanied by a 10% down payment, usually in the form of a cashier’s check.
The executor can accept the highest offer, but the court decides whether to accept the offer. This occurs during a confirmation hearing, which takes time to schedule (about four to six weeks from filing the petition). In the interim, family members must be notified of the sale of property and given time to have input on the terms of the sale. Other bidders can make offers higher than the original offer at the hearing, known as overbidding.
The house will go to the highest bidder, and they must provide a cashier’s check for a 10% deposit upon winning the contract. The original buyer is refunded their 10% down payment. After the house is sold and the proceeds are applied to the probate cost and estate debts, the probate court splits any remaining profits among the beneficiaries.
What happens when a house goes into probate depends on state law, but generally, either the decedent’s next of kin will inherit the property or the house will be sold through a probate sale. Dealing with a probate property is a long process that you should handle with the utmost care. When starting the process, make sure you consult with an experienced certified probate real estate specialist and a probate attorney who can help you through the ins and outs of the probate process.