If you are a buyer looking for a home, you may see probate sales. If you are needing help to sell a home in probate, this information is good as well. There are risks and probate sales usually take longer than standard home sales. There are two types of probates sales, those that need court confirmation and those that don’t.
Homes sold in probate court occur when someone dies without leaving their property in a trust or will. The state takes over and administers the property’s sale using a probate attorney or estate representative. Their job is to find a local real estate agent and get the property sold.
Probate sales are marketed just like all other properties. A Realtor or real estate agent gets a signed listing agreement from the representatives, lists the property on the MLS for amount decided by an independent appraiser, shows the property and collects offers in a timely manner to present for an initial decision.
Interested buyers can make offers on the property but the offer must be accompanied by a 10 percent deposit in most cases. The estate representatives will counter and accept offers the same as if it were a standard home sale. Court confirmation will occur after an offer is accepted and a court date as been determined, typically 30-45 days later. If it does not require court confirmation and the best offer is within 10% of appraisal, escrow can simply close as normal with nothing addition needed.
For the sales which to need to be confirmed, the court will require that the buyer and any other interested buyers, come to the probate court for the confirmation. The property is then sold auction style if other buyers show up, so just because the first buyer went through the process and had an accepted offer, it doesn’t matter. In a way, that initial offer is simply used to start the bidding!
If no other buyers show up to bid on the home, the first buyer gets the property for their original offer price that was accepted originally. If the property is sold to one of the new bidders, then that buyer must be ready to give a deposit of 10 percent, which is often times nonrefundable.
One thing to consider, is that since the seller is deceased, information and property history, or potential condition problems with the home, may not be disclosed.