Homes in Probate

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Many people have heard of the probate and the estate settlement process, but wonder what it is and what the probate process entails. To put it simply, probate is the process the probate court uses to make sure the deceased person’s creditors are paid through estate settlement and that anything left goes to the deceased’s beneficiaries.

Unfortunately, the probate and estate settlement process can be anything but simple, depending on the size and nature of the assets to be administered, the number of parties involved in the probate and estate settlement process, how well those parties get along, and many other factors. Complex probate and estate settlements are made all the worse by the fact that the family is in a state of mourning and under a great deal of stress. The last thing most families want to deal with at a time like this is the probate court system.

Contact a local probate real estate agent who specializes in probated property. Probate property sales may be marketed like any other home sales, but an experienced probate real estate specialist has the knowledge and the patience to guide sellers and buyers through the court proceedings and the process, bearing in mind that each property and probate is unique, and will encounter different and obstacles. The executor of the estate (the person in charge of disbursing a person’s goods after they die), will be responsible for hiring a real estate agent, and hopefully will hire one who has probate experience, to handle the marketing and sale of the property.

US Probate Services was created to help people who find themselves in the probate process and don’t know where to turn.  In our Probate Resource Directory you will find a nationwide network of Real Estate Agents, certified in probate, dedicated to help you through the probate process. Visit USProbateServices.org. To contact me directly, click here.

Selling Real Estate in Probate

Pros:

• Quick Access to Cash: Provides a lump sum of money to beneficiaries for immediate needs or debts.
• Avoids Ongoing Management: Eliminates the need to manage tenants and property upkeep.
• Settles Estate Efficiently: Selling the property can finalize the probate process quicker.

Cons:

• Market Conditions: Selling during a buyer’s market may result in a lower sale price.
• Missing Out on Appreciation: Heirs forego potential future gains if the property value increases.
• Emotional Detachment: Selling a family home can be emotionally difficult for some beneficiaries.

Keeping Real Estate in Probate

Pros:

• Sentimental Value: Heirs can retain the property for personal use or memories.
• Potential Appreciation: Heirs benefit from future increases in property value.
• Rental Income Option: The property can be rented out for ongoing income.

Cons:

• Financial Burden: Heirs are responsible for ongoing costs (taxes, insurance, maintenance) without income.
• Disagreements: Shared ownership can lead to conflicts between heirs over usage or upkeep.
• Liquidity Issues: The property cannot be readily converted to cash if needed.

Remember: The best option depends on individual circumstances. Consider seeking professional guidance from a financial advisor or probate attorney to make the most informed decision.

Renting Real Estate in Probate

Pros:

• Steady Income: Rents provide a regular income stream for beneficiaries.
• Potential Appreciation: Over time, the property value may increase, benefiting heirs in the future.
• Tax Advantages: Rental property owners can deduct certain expenses (repairs, depreciation) from their taxes.
• Control Over Property: You choose tenants and manage the rental process.

Cons:

• Management Responsibilities: Dealing with tenants, repairs, and maintenance can be time-consuming.
• Vacancy Risks: Unoccupied periods may lead to lost income.
• Market Fluctuations: Rents may not always keep pace with inflation or property taxes.
• Potential Damage: Tenants may cause damage to the property requiring repairs.

Terri.M@StetsonBentley.com