To help you understand the probate and trust sale process,here is a list of some of the steps involved in a typical transaction:
Appointment of the Administrator or Executor of the estate. This is the person who the deceased named in his or her will to carry out their final wishes. The executor or Administrator of the estate are designated to distribute assets including Real Estate and they are the one with the authority to hire the Real Estate professionals. If the Executor is unable or unwilling to carry out the task the courts will name and executor. The execution of the will cannot move forward until this person has been identified. This is usually formalized through a probate process.
Once the Executor is established, they move forward with the sale of the property. As part of the trust, an appraisal is usually conducted to determine market value for the property and to set a Probate Referee's appraised value, the appraisal is also used for filing taxes for the estate. Taxes for the estate take the value of the property at the time of death for calculation purposes, if the estate value is more than five million dollars death taxes may apply. Appraisals are only valid for three to six months and possibly even less if the Real Estate market in a given area is changing quickly. It is in the best interest of the family to enlist the help of a licensed Real Estate Agent to look at recently sold properties to determine a final price, just before going to market. Additionally, if the family does any work to clean up and stage the property prior to going to market the value of the property may change. It is a good idea to work with a skilled Real Estate Agent in the local area to give accurate advice on the local market, who knows what buyers expect in terms of property condition and can help facilitate estate sales, repairs and staging so the estate gets the most value from the property.
Once the administrator of the estate is ready to list the property the real estate agent moves forward. This is a similar process to selling property from any individual. The agent, helps the seller get the property ready to go to market and implements their marketing strategy which may include the following: listing the property in the local Multiple Listing Service, taking professional photographs, putting up signs, advertising through traditional and electronic media, inviting local real estate agents to see the property to maximize exposure, setting up a showing service so that interested parties can see the property.
While buyers of an Estate may be looking for a bargain, their range of offers are limited by the court. An accepted offer must be 90% or more of the Probate Referee's appraised value. Once a buyer is found, thereal estate agent assists the seller in negotiating termsthat are satisfactory to both parties.
When the property has an accepted offer, the heirs are notified of the contract proposal, If there are no objections, the sale may proceed without a court hearing. This can be a frustrating process because the heirs, courts and lawyers may need more time to decide than the contract allows. The Real Estate agent will need to negotiate between the buyers and sellers to manage expectations around time lines and deadlines for both the estate and the real estate contract. If the Executor/Administrator does not have full independent powers, or if one of the heirs objects to the Notice of Proposed Action, additional action may be needed before moving forward.
Until the contract has been accepted and signed by the executor or administrator the property should continue to be shown and marketed. Once the contract to buy and sell has been signed and the sale of property is pending then marketing and showings can cease. Once the sale is complete and the deed has been transferred to the new owner, the estate receives a check for the proceeds of the sale to be distributed according to the requirements of the trust.
In order to process the sale of the property the title company and county may require the following documents:
Recorded Death Certificate
Supplemental Affidavit
Personal Representative Appointment
If you need assistance with this process, or if you have any questions at all, please don't hesitate to contact me. I am happy to help with whatever you might need.
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