Things You Need to Know to Sell a House in Probate
Selling an inherited house through probate can be a challenging task in many ways. However, having the right information at hand and doing a little bit of planning ahead of time will go a long way toward making the procedure go more smoothly. With that in mind, here's a short rundown of what you need to know about selling a probate home.
What is Probate?
Probate is the court-supervised method of authenticating a deceased person's final will and testament. It entails identifying and valuing the deceased's possessions, paying their final bills and taxes, clearing any outstanding debts, and transferring the estate's remaining properties to their rightful heirs, usually with the help of a probate lawyer.
In most cases, a house must normally be sold through probate to pay off the debts of the estate. If there is no official heir named in the will, or if there is no will in place at all, then the court assigns legal ownership to one of the heirs for the sake of the sales process through the state intestacy law.
How Probate Sales Work
It's important to remember that the probate sale process differs by jurisdiction, so it's a good idea to brush up on your state's specific laws so you can be properly prepared. However, the majority of probate sales will follow this pattern:
Find and Begin Working With a Probate Attorney
First things first, you should contact a probate attorney near you as soon as possible. The probate process can be long and complicated, and having a probate attorney on board from the beginning will help the sale go through as smoothly as possible.
File a Petition to Start the Probate Process
The next step is to file a petition with the local court. This makes the probate process official and is necessary to start the sale process. Keep in mind that the courthouse must be near to where the deceased passed, so look for a probate lawyer who specialises in these local regulations.
Take Inventory of the Estate
Gather all of the relevant information you can on the estate. This includes all of the estate planning documents, such as their will and funeral arrangements. You must also detail all of the deceased's assets and debts, so the court can assess the estate and see what creditors need to be paid and for what amount.
Notify Known Creditors & Pay Legitimate Claims
Now that you know who the creditors are, they must be notified about the situation so you can pay their claims with money from the estate. When the amount owed is larger than the amount of liquid cash, the property must be sold through probate in order to pay back creditors.
Manage Income Tax Returns
File income tax returns for the deceased and make sure to take care of the inheritance taxes in your state too.
Assets Are Legally Transferred to Beneficiaries
Finally, once you have taken care of all of the above measures, you must petition the court to get them to legally transfer the assets to the listed beneficiaries and heirs.
What are the Problems with Selling a Probate Property?
One of the main problems with selling a probate property is its length due to its complexity. Each case is different, and there are a number of things that can delay the process and prevent you from selling your inherited house fast the easy way.
Secondly, there are confusing laws that vary from state to state, which makes navigating the process complex and stressful, especially during a time of grief.
How Long does Selling a Probate Property Take?
It all depends. In general, selling a probate property will take much longer than a normal sale due to the extra legal hoops you have to jump through. Granting probate alone can take up to 14 weeks, and then the sales and conveyancing process can take several months, as with a normal house sale.
Can You Sell a House under Probate?
If there is a property in the estate, then there is nothing stopping you from putting the house up for sale. However, you need permission from the court, and there are a whole bunch of legal processes that you must go through first.
Finally, if the deceased has creditors and debts that must be paid, then the proceeds from the sale of the house will be used to pay these debts before any of the heirs or beneficiaries receive the funds.
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