Properties sold in probate court (hence "probate sales") are homes that are sold when someone dies and the property is not bequeathed to someone else. When that happens, the state takes over the sale.
You can often buy property at a lower price if they are probate BUT the transaction often takes longer to complete.
Each state has different rules when it comes to a probate sale. If the executor or administrator has complete authority under the Independent Administration Estates Act to sell the home, they are also not held to the same rules.
In California, here are the main probate points:
An executor or administrator of the estate is the "seller"
The sale price must be 90 percent of the appraised value within one year of sale.
Estate representatives may require 10% down but it is NOT required by California law.
A notice of sale is required unless the Will specifically states the property to be sold.
The court must confirm the sale within 30 days.
The administrator may hire a real estate attorney to sell home within 90 days.
A Transfer Disclosure Statement (TDS) is required.
Do you see how complicated it can get without a trusted advisor?
On the other side, this is why it is extremely important that we take into account your Estate Planning when building your wealth through Real Estate.
As Wealth Builders through real estate, we want to stay relevant in your future real estate plans and become your #1 professional go-to source.
Here are some common things that people do not take into account when dealing with their single biggest asset in life - their real estate:
More than 70% of people don't have a Will
There is more than $50 BILLION (yes, NINE ZERO's) of unclaimed property or assets being held by the State of California ALONE due to people not taking simple estate planning measures
The AVERAGE cost of a probate sale could be anywhere between $20,000-$50,000
The court takes the FAIR MARKET VALUE of your home (not just the equity you have in the home) to determine probate fees.
The majority of people simply DON'T get around to Estate Planning until it's unfortunately too late
So, here are 6 important things that YOU HAVE to know when considering your estate planning
Make a Will
Determine Guardianship for your minors
Create a living trust for any assets that have Title (that's your HOUSE)
Designate a financial power of attorney
Designate a Medical Power of attorney
Make sure that your Power of Attorney has access to all the key information that they'll need