When it comes to selling a house in probate, there are several factors involved. Moreover, there are series of court hearings, along with negotiations that can lead to tensions and stress among those involved. Whether probate is carried out with court confirmation or independent administrators, the whole process always ends up in the court room.
Selling a House in Probate: How it Works
There are several situations involved in probates. Initially, an executor or administrator will be appointed. In case an executor is nominated in a Will, the individual will become the appointed executor (assuming he is willing to serve). However, when there is an absence of Will, there is a need to appoint an administrator. In most instances, the administrator may be a public administrator, an heir, or a person nominated by the heir.
If the executor is granted full powers, he or she will list the property that is for sale. When an acceptable contract has been completed, the next process involves the mailing out of a Notice of Proposed Action that indicate the proposed sale’s terms. There are 15 days provided to heirs to object or have their say on this matter. Supposing no objections are made within this period, there will be no need for a court hearing to begin the sale.
Afterwards, an offer is made, which should be at least 90 percent or more of the appraisal made by the probate referee. The interested buyer should give 10 percent deposit upon acceptance of the offer, yet this amount is forfeited in case the buyer does not perform the conditions of the terms.
When the offer has been accepted, this will be followed by a filing of a petition to court, which indicates confirmation of the sale. Then, a hearing is scheduled, following the filing, and it should take place about 30 to 45 days after the petition is filed. All the heirs will receive a written copy of the details concerning the offer and the petition.
Lastly, an overbidding may take place during the court confirmation hearing. Moreover, the buyer who accepted the offer made can also be a part of the overbidding. Generally, 10 percent of the initial $10,000 is the minimum overbid, and there is an additional 5 percent of the balance to the offer that has been accepted. It is also important to present a check for the 10 percent of the minummum amount of overbid before the overbid is made. The winning bidder will present this cashier’s check to the executor during the hearing. Then, contract signing is followed, and the escrow closes in a matter of 15 days after the court hearing has been completed.
In addition to these procedures, it is important to note that there are issues that may arise during selling a property in probate. These include required disclosures, the contract used for the offer, aspects that make an offer either strong or weak and whether there are different requirements by the public administrator and private attorney. These details all depend on the executor and jurisdiction, so it is best to consider these aspects to ensure the success of the entire process.
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