SELLING PROPERTY
After a Loved One Dies
So, You Inherited A Property.
Now What?
Selling a house that's part of an estate involves specific legal processes to ensure that the property is properly transferred or sold according to the deceased person's wishes. At the English Law Group, our attorneys have decades of experience in both probate and title to make the process as seemless as possible.
01. Legal
Considerations
Determining who owned the property. Title to real estate can be held in trust, the person’s name, a company, or more than one person’s name. This seems like a simple question, but it might not be, depending on how things were handled when the person was alive.
Probate Initiation: When someone passes away and leaves a will, the will must go through probate. Probate is the legal process by which the deceased’s assets are distributed according to the terms of the will. Having a won’t mean the assets go according to the will immediately upon death. A probate judge must first review it and make sure it’s valid. Once she/does this, then the will can transfer assets through the probate court.
Executor or Administrator Role: Only the court-appointed executor (if there’s a will) or administrator (if there’s no will) has the legal authority to handle the property of the estate. However, being appointed does not necessarily mean the person has the authority to sell real estate. Verify that the person handling the sale has been legally appointed, and in what capacity.
Clear Title: Make sure the property title is clear and free of liens, debts, or other encumbrances. A title search might be necessary to identify any issues that need to be resolved before listing the property.
Disclosure Requirements: Be aware of any legal requirements to disclose information about the property’s condition, probate status, or other relevant factors to potential buyers.
02. Timing
Understand that the probate process can take months or even years.
The timing of when you can list real estate property may depend on how quickly the probate process moves.
It can take over a month in some jurisdictions for an Executor or Administrator to get appointed through the court, and being appointed doesn’t necessarily mean the person can sell real property without court approval.
An attorney should always advise who needs to sign contracts and closing documents and in what capacity.
Disclosure Requirements: Be aware of any legal requirements to disclose information about
the property’s condition, probate status, or other relevant factors to potential buyers.
03. Property
Preparation
Maintenance and Repairs: Assess the property’s condition and determine whether any repairs or maintenance are needed before listing it. Well-maintained properties tend to attract more buyers and sell for higher prices.
Cleaning and Staging: Clean the property thoroughly and consider staging it to make it more appealing to buyers. This can be especially important if the property has been vacant for a while.
Curb Appeal: First impressions matter, so make sure the exterior of the property is tidy and inviting.
Probate Initiation: When someone passes away and leaves a will, the
will must go through probate. Probate is the legal process by which the
deceased’s assets are distributed according to the terms of the will.
04. Valuation
& Pricing
Comparable (Comps): A Qualified Real Estate Agent can provide you comparable and give advice on which, if any, updates and repairs should be made prior to listing.
Competitive Pricing: Set a competitive price based on the appraisal, market conditions, and comparable sales in the area. Overpricing can lead to a longer time on the market, while underpricing might leave money on the table.
Appraisal: Some estates get a professional appraisal to determine the property’s fair market value. This could be required if the estate sells without a Realtor, or one of the heirs, as the court may require an accurate valuation.
05. Working With
Professionals
Real Estate Agent: an experienced real estate agent, preferably one with experience in probate sales. They can guide you through the process, help with pricing, marketing, and negotiations, and ensure compliance with legal requirements. We can help.
Attorney: A probate attorney can help navigate the legal complexities of selling a probated property, including obtaining court approval and addressing any issues with the estate. We can help.
06. Marketing The
Property
Targeted Marketing: Work with your real estate agent to create a marketing plan that targets potential buyers who are interested in probate properties, such as investors or first-time homebuyers.
Disclosure in Listing: Clearly indicate in the listing that the property is part of an estate and is being sold through probate. This transparency can help set expectations for potential buyers.
07. Negotiating
Offers
Court Approval: In some cases, the court will need to approve the sale. It is important to understand when this is required and what that entails. The experienced attorneys at the English Law Group can advise and help navigate this process.
Executor’s Discretion: Some wills give the executor the discretion to sell the property if it’s in the best interest of the estate. In such cases, the executor can decide whether or not to sell the property.
Offer and Acceptance: Many times, heirs will need to be involved in the sale, and/or the Court will have to Order the sale.
08. Closing The
Sale
Mortgages and liens: All valid liens, taxes, and mortgages will be paid at closing.
Court Approval for Sale: Timing is everything when it comes to closing the sale of court-ordered property. We can help guide you through this process.
Distribution of Proceeds: After the sale, the proceeds will need to be distributed according to the terms of the will or the laws of intestacy (if there is no will). If the estate is still open the check for the proceeds should be made out to the estate. Heirs should not get their share at the closing. They will have to wait for the Executor or Administrator to distribute it from the estate account. This may involve paying off debts and distributing the remaining assets to heirs.
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09. Communication
With Heirs
Keep Heirs Informed: Regularly communicate with all heirs or beneficiaries throughout the process to keep them informed about the status of the sale. This can help prevent misunderstandings and disputes.
Dispute Resolution: Be prepared to handle any disagreements among heirs regarding the sale. A neutral third party, such as a mediator or attorney, may be helpful in resolving conflicts.
10. Tax
Implications
Capital Gains: Be aware of the potential capital gains tax implications if the property has appreciated in value since it was inherited.
Estate Taxes: Consider whether the sale will have any impact on the estate’s tax obligations and plan accordingly.
Listing probated real estate requires careful planning and attention to detail. By considering these factors and working with the attorneys at the English Law Group, you can navigate the process more smoothly and achieve a successful sale.
Contact the probate attorneys of The English Law Group, P.S.C. to arrange your initial consultation. From our offices in Louisville, we can help settle estates in Jefferson County, and throughout North Central Kentucky, and Southern Indiana.
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