Thinking of Buying or Selling Probate Property?
I have been approached time and time again regarding the purchase or sale of probate property. Usually you are selling for a small profit or purchasing at a great deal. Here is what you need to know to decide whether or not you want to move forward.
First, it is not a “normal” buy-sell transaction that you may be use too, or even what you possibly heard about. Depending on the state, and the particular statute, there are a series of requirements that must be met, prior to selling and purchasing the property. If the property is in probate, then that usually would mean that the deceased property owner did not died with a trust or a will. Even if he/she died with a will, it may not have included a specific designation of a license to sell, which means that even if the will is approved, the Court will still have to allow a license to sell in order to sell the property. Now again, this depends on what state you are looking to sell/buy.
Next, these types of deals do not happen overnight. Know that anything involved in probate in any state could take months/years before the transfers happens especially since it really depends on how far along the personal representative/executor is with the probate. Therefore, if you need to move right away, or if you have a rate lock expiration, this may not be the property for you at this time.
Third, even if you have a purchase and sale agreement/purchase agreement, the court will most likely say, you have to accept the highest and best offer. This may mean that your Purchase Agreement may be voided at any time, regardless of how long you waited to close on the matter. Normally the seller will have a clause in the Purchase Agreement stating this is the case.
Lastly, there are so many other scenarios that come into play with probate properties, i.e. the heirs are unknown, are in disputes among each other, mortgage is more than the worth of the house. If you have the time, the funds, and then patience for a probate deal, you don’t want to pass it up. Make sure you have the right attorney representing you in this type of transaction, as you want to make sure you are protected throughout the entire transaction. Give me a call, 508-846-6021.