Can I Sell a House During Probate?
A while back we shared an article about Probate. We talked about what it is and the basics of how it works in Kansas and Missouri. But people still had questions.
One of the big questions was how to sell a house in probate. Or if it is even possible to sell the house BEFORE the probate process is complete. Most people find it much easier to keep track of and maintain proceeds from a sale sitting in a bank. A vacant house, on the other hand, requires regular check-ups. Plus they accumulate taxes, insurance, utility, mowing, and other bills every day.
Now we are not here to take the place of legal advice from a good attorney. We are providing some information to give you a basic idea of your options when it comes to selling a house in the middle or after the probate process. And as all the legal advisors we have consulted tell us, every probate process is different and it could be as short as a couple of months and a more complicated estate may take a lot longer.
If you have a house to sell during probate, there are some basic steps to follow.
First: Hire a Probate Attorney
Before you do anything about selling the house in probate, hire an attorney to provide guidance and counsel through the probate and sale process. If it is a low-value house you may be able to sell it without a lot of hoops. And you might have to do more if it’s a bit higher-priced home. If there is a traditional or a reverse mortgage, heirs might need extra help from an attorney.
Second: Determine the Home’s Value
After consulting with an attorney and determining that selling the house right now during probate is the best option, your next step is going to be to determine what the property is worth.
To find out value you may be able to hire a Realtor who knows the area to complete what they call a Comparative Market Analysis. As Realtors ourselves, we have done a few of these for small-value estates at the request of attorney friends. Other times you may want to hire an appraiser to determine value. Consult your attorney to determine if you need a CMA or an appraisal. They may even recommend someone for the valuation.
Third: Get the Probate Court’s Permission
Armed with a valuation on the property, the next step is to get permission from the probate court. Depending on the type of estate in probate there are different forms and petitions. Ask your attorney which form you need to file. Sometimes, the court requires a sale contract from a valid purchaser, so you might need to complete steps 3 and 4 in reverse order.
Fourth: Find a Buyer
There are many options for finding a buyer. You might list the house for sale with a real estate agent, but traditional buyers may not want to wait for step #5 – Approval. Listing it for auction could have the same issue, with buyers unwilling to wait for approval. However, if you contact a direct buyer like kcmoHomeBuyer, we can provide a valid contract for court approval. In most cases, we are willing to wait out the process.
Fifth: Get Approval for the Sale Contract from the Probate Court
Depending on the type of estate, the probate court may approve a contract if it is roughly 75% of the property’s initial inventory value. In other cases, the court may want to offer it up for auction to see if they can get a higher value than the initial contract. So you can see why most traditional buyers may not want to make an offer.
Finalize the Sale
If you can find a buyer that will offer a sufficient amount to satisfy the court, you can then proceed to closing.
Issues that May Come Up When Selling a House in Probate
- Owe Too Much: The probate court may approve a contract if it is roughly 75% of the property’s initial inventory value, depending on the type of estate. In other cases, the court may prefer to auction the property to seek a higher value than the initial contract.
- Contract Price Not High Enough: It may be that a buyer cannot be found at a high enough price to satisfy the court. In this case, you should seek the advice of your attorney who may advise you to just wait for the probate process to complete and then proceed with the sale.
If you have inherited property in the Kansas City Metro area and are seeking a valid buyer, the Tuckers here at kcmoHomeBuyer.com would love to work with you and your attorney. Please give us a call or submit your property information with one of the forms here on our website.
