If you have been appointed as the personal representative of a loved one’s probate estate, you may be faced with selling a house in probate. California law has specific requirements for how property is sold during the probate process, how much it is sold for, and the timeline during which it is sold. It is essential that you understand the applicable laws related to the sale and contact The Legacy Lawyers for help to avoid potential liability.
The Probate Sale Process
If you are legally appointed an administrator of a deceased person’s estate, at a minimum, you must provide notice to all parties who have an interest in the estate. This is called a “Notice of Proposed Action,” and the heirs are given 15 days to object. If all of the heirs are agreeable to the sale and you wish to move forward without the waiting period, they can sign a “Waiver of Notice of Proposed Action.” The will itself or other interested parties could prevent independent administration.
You may also have to obtain approval for the sale from the probate court. However, some cases, such as independent administration of estates, may proceed with selling without the court’s permission. You must apply for and receive independent administration under the Administration of Estates Act (IAEA) to move forward without court oversight.
You may also move forward without court permission if the real property you are selling was put in trust by your loved one before their passing. However, in any probate case, if the heirs are not agreeable to the sale or you as an administrator, the case will need to be overseen and settled by the probate court.
There are several ways to facilitate the sale, depending on which is best for your unique situation:
Hire a real estate agent.
Handing the job of selling the real property during probate over to a real estate agent is the most common way to get it done, as well as the easiest. This method is hands-off and stress-free for you as the administrator. Probate attorneys commonly have referrals available for real estate agents and probate brokers that they have experience with and trust.
It would be best if you make any necessary updates and repairs to the property before handing it over to an agent. They are responsible for inspecting the house and ensuring it is fit to sell.
Hold a private sale.
A private sale is held by your attorney and involves posting the house in legal newspapers and private bidding via sealed bids from potential buyers. The house is sold to the highest bidder at the end of the bidding process.
Hold an auction – private or public.
Information about an auction is posted in legal newspapers, listing the date and time. Potential buyers will call out their bids, and the house will be sold to the highest bidder. The only difference between a private auction and a public auction is that it is facilitated privately by an auction company.
The Price of the House
The court must approve the terms of the sale before the house is sold. These terms can vary depending on in which county the home is located.
When you are ready to accept an offer, a court hearing must be scheduled to petition the court for confirmation. The court may reject the sale if the sale price is not at least 90% of the appraised value. This appraised value must be current within a year of the sale. Additional requirements must be met if the real property is in pre-foreclosure status.
If you are operating in the capacity of an independent administrator approved under the IAEA, you do not need to attend a court hearing to have the sale confirmed. Potential buyers can attend this hearing and continue placing bids on the property of at least 5% plus $500 more than the original buyer’s bid.
The Timeline for the Property Sale
Probate real estate sales in California have a timeline of an initial 90 days. Beyond this period, it is possible to request 90-day extensions. The probate court must approve these extensions.
Again, if you are operating as an independent administrator under the IAEA, you are held to a different 90-day window. However, you must notify the court if the property has yet to be sold after 270 days.
Work with a Probate Attorney You Can Trust
Contact us at The Legacy Lawyers for help with selling real property during a probate proceeding to avoid potential liability. One of our experienced probate attorneys can help ensure that you provide notice to all of the necessary parties and follow the proper procedures for pricing and timeline.
We will carefully walk with you every step of the way. You will never be left wondering what to do next. Start by calling to schedule your no-cost consultation: (800) 840-1998. We are dedicated to your peace of mind.