PROBATE SERVICES

Why GLOBAL REALTY GROUP is your idea choice for Probate Real Estate Sales

Our agents have the ability, experience, and expertise to:

  • Determine the time frame when escrow can close on your decedent’s family estate.
  • Ascertain what legal documents title will required
  • Calculate the overbid amount for limited authority cases requiring court confirmation
  • Utilize the required C.A.R. forms to ensure the documents in the transaction are legally binding
  • Advise the estate’s personal representative what documents are required to sign the listing agreement.

 

TIMEFRAME FOR CONTACTING A REAL ESTATE PROFESSIONAL

When a petition to start a probate case is filed and court appoints a personal representative (PR) to oversee the affairs of the decedent’s estate, letters of administration (where decedent did not have a will) or letter of testamentary (where decedent had a will) and orders of probate are issued by the court usually 2-4 months after the case is filed. Once these documents are in the hands of the ‘PR’, he or she can engage the services of an agent or broker and sign a listing agreement.

 

FULL AUTHORITY CASES

The court will either grant limited or full authority on the case. If the case is full authority, the courts will not have to confirm the sale. The seller does not have to wait for the court appointed referee to appraise the property, nor is the sales price required to be a percentage of the appraised value. An offer can be accepted with letters and orders. Once the probate purchase agreement is executed, the attorney or PR (if the case is ‘pro per’) prepared the Notice of Proposed Action which is filed with court and copies mailed to the beneficiaries. Any heir wishing to object can do so but the court required this to be done within 15 days of the date the documents were mailed. An escrow can not close until the 15 days have elapsed.

Full authority cases only require a 3% earnest money deposit and escrow can close with Notice of Proposed Action in addition to the letters and orders.

 

LIMITED AUTHORITY CASES

In these cases, the court requires the sales price to be 90% of the appraised value as determined by the court appointed referee. There is a judicial council form known as the “Inventory & Appraisal” that will be completed by the referee; however, there will be two appraisals, one of which provides an appraisal as of the date of death of the decedent. The second would be the current valuation of the property as determined by the referee.

The court also requires that a “Notice of Sale of Real Property” be published in a local newspaper in the county where the property is located, if there is no such newspaper, in such a newspaper as the court or judge may direct (Probate Code §10300(a)). The publication is  required at least three times over a period of no less than ten days before the sale, and the third publication must be at least a week after the first was published. After the publication process is completed, you can execute the Probate Purchase Agreement.

The initial deposit for limited authority cases is 10%. The buyer would need to remove all contingencies, with the except for the contingency of court confirmation. When ALL contingencies are removed in writing by the buyer, the probate attorney or PR will prepare and file the “Report of Sale and Petition for Order Confirming Sale of Real Property with the courts. The petition will include the deposit and overbid amounts. If the original bid is $700,000.00, $10,000.00 is deducted by that amount. Then $1000.00(10% of the first 10,000.00) will be added to 5% of $690,000.00 ($34,500.00 + $1000.00=$35,500.00).

The court will require a $465.00 fee for filing the petition to confirm the sale and set the court date when the amount has been paid. Any bidder appearing in court will be required to pay a 10% deposit and the funds are to be paid in the form of a cashier’s check. When the sale is confirmed, the judge will sign an “Order Confirming Sale of Real Property” awarding the real property to the highest bidder and  escrow will need a certified copy of this order to close on the transaction.

The law required that proceeds from the sale are deposited into a bank account in the name of the estate, where funds shall remain until the completion of the probate case.  The bank account is usually opened by the personal representative prior to the close of escrow. The financial institution will a copy of the Order for Probate, a certified copy of the Letters and a tax ID number for the estate.

The matter of capital gains will always come up in matters of trust/estate sales including probate. Our firm as a matter of operating procedure have a disclaimer that clients and prospective clients should seek the advice of an attorney or CPA for any tax or legal matters related to the probate case. There are some fundamental changes to tax laws that are proposed by the current administration; however, the majority of estate sales are allowed a ‘step up’ in cost basis to the market value of the decedent’s death. But again, check with your accountant or CPA to determine what if any tax implication there will be for the estate and beneficiaries.

Whether you plan to list the property on the open market or engage us to refer you to investors, we will have the PR complete a Probate Questionnaire generated by our office that will provide us with information necessary to appropriately market the property. An agency agreement will be provided to the PR for review of terms of the initial business arrangement between the estate and our firm. Our office will perform a walk-through inspection of the property on a mutually agreed upon date and discuss time frames/strategies for the sale.

Once the specifics are agreed to, our office will commence the process of getting the property sold for terms/consideration acceptable to the estate.