Last updated on January 30th, 2023 at 01:09 pm
What is Probate
Probate is a legal procedure for determining that the owner’s will is valid (legally binding). The steps involved in the probate process are establishing the accuracy of the will, locating and inventorying their assets or property, having those assets evaluated, paying any appropriate taxes, claims, and/or obligations, and distributing the remaining assets in accordance with the will.
- Probate homes sell for an average of 10% below market value.
- You must have a law license in the state of Texas in order to file documents on behalf of an estate.
Many different parties are usually involved in the process, including lawyers, the executor, and the will’s heirs. An application for probate must be filed; this can be done at the office of the county clerk in the county in which the owner took residence. Don’t confuse an executor with a trustee.
A trustee handles all assets of a trust and is in charge of the responsibilities of said trust.
When a residence is in probate, a legal process is followed to recognize the heir. This will include public notice when the court schedules a hearing. If there is more than one heir, they may have to come to a consensus in order to sell the property.
If you want to skip the hassle, the easiest way to solve the issue of “how to sell a property in probate” is to hire someone who has experience in this, like a real estate agent! They can help you with all the ins and outs of the probate sale.
Here are a few situations that could occur if a property goes into probate. This can be a lengthy process with lots of documents and proceedings.
Property is Transferred in a Will
If the owner left a will, his intentions must be carried out. In this case, the executor is required to transfer property to the beneficiaries through probate court.
The probate judge will transfer the residence to the true heir in accordance with the terms of the will. It is up to the beneficiary to decide whether to keep the inherited house or sell it.
- In order to sell a property in probate in Texas, you must first obtain a court order authorizing the sale.
What is an Executor?
An executor is a person who is appointed by a testator to carry out the terms of their will. The executor is named in a will.
The executor needs to be very careful distributing assets that are not stated in the will!
What is an Administrator?
The administrator is not named in a will.
Intestate Probate of a House Defined
In the absence of a will, the decedent’s property passes through intestate probate.
This is not the case if the property was transferred using a joint tenancy law, transfer-on-death deed, or living trust.
The court is charged with transferring the decedent’s house in an intestate probate scenario. The judge may appoint an immediate relative as executor of the estate. A surviving spouse, children, or next of kin can be named as the beneficiary.
The Home is Sold by the Executor
- If the owner did not specify a beneficiary, the property would be sold in probate by the named executor. The executor will then need to find a real estate agent to list the property for sale.The real estate agent will need to obtain a certified copy of the court order authorizing the sale. The executor will need to review all offers on the property and present them to the court for approval.
- The court will then approve the sale of the property and issue a final order authorizing the sale.
How Long Does It Take to Sell a House After Probate?
When a house is in probate, it cannot be sold until probate is granted. There is no time limit for obtaining a Grant of Probate. This grant may be issued in six weeks for non-taxable estates. You can obtain the Grant of Probate in 12 weeks for a taxable estate where inheritance tax is due. If the courts decide your case is urgent, you could receive this grant in as little as two weeks.
You may have to wait several months after obtaining a Grant of Probate for the sale to go through.
Texas Real Estate Probate Procedure
Because of the adoption of “independent administration” of property, the Texas probate process is much faster. This procedure enables executors to handle probate issues with little intervention from Texas courts. This is the preferred method with fewer hassles and appearances in the court.
If a will exists, the entire Texas probate process can be completed in as little as six months.
Texas handles the Process in one of Six Ways
- Dependent administration of estates
- Independent administration of estate
- Muniment of Title
- Affidavit of Heirship
- Small Estate Administration
- Determination of Heirship
Independent Estate Administration
When handling probate cases in Texas, most executors seek independent administration of estates. Because it requires less court supervision, this process is faster, more efficient, and less expensive. Because of this efficiency, many testators include independent administration in their wills.
Before taking action as an independent executor, the will’s executor must seek permission in a court hearing.
When distributing assets, the executor is not required to seek permission from the court due to the independent administration of estates. It also protects the prosecutor from damages caused by carelessness.
Estate Administration for Dependents
In this case, the courts are actively involved in the probate process. In this process, several scenarios are possible.
Minument of Title
If you have a will, the muniment of title is an easy way to transfer property to the rightful owners. All you have to do is file the will with the correct paperwork and request that the court probate it as a muniment of title. The will will be used as proof to the estate assets by the court. There must be no debts and liabilities that are owed to another party. The must also be no disputes over heirship. In this case, you do not require the services of an executor.
Affidavits for Small Estates
If there is no will and the property’s value is low, a beneficiary can claim it by preparing an affidavit. The beneficiary must be a person who can inherit the estate under Texas intestacy law.
You won’t have to find it difficult to sell your home once you’ve obtained a Grant of Probate.
How To Find an Attorney
If you don’t have legal representation, trying to navigate the probate process can be difficult. The legal jargon and technicalities involved may be intimidating to the average Texan. That is why some Texas courts prohibit non-lawyers from filing applications to probate a will. You can ask the lawyer if you can sell a property without going through probate.
When dealing with probate, it’s always a good idea to hire an attorney. You may require the services of a lawyer if:
- You’ve been named as an executor in a will.
- The executor was not named in the will.
- The named executor is not performing their duties satisfactorily.
- The named executor has died or is unable to carry out probate duties.
Probate attorneys are classified into two types: transactional probate lawyers and probate litigators. The former is in charge of administrative matters, while the latter is in charge of probate lawsuits. Although some lawyers provide both services, a specialist is more likely to provide excellent probate services.
Finding the ideal probate lawyer is not easy. You’ll need to conduct research, ask their advice, and interview potential candidates. When conducting your research, look far beyond legal expertise of a probate lawyer. Consider the following factors:
- Online feedback and ratings
- What are the fees they charge? Whether it is hourly or flat-rate.
- Personal requirements
Be sure you meet with many lawyers and ask important probate property questions. Some crucial questions to ask include:
- What is your payment plan?
- What is the number of probate cases you handle each year?
- Can I handle some probate issues as an executor to save money?
- How long will it take to complete the probate process?
- Can you handle probate cases in other states involving the decedent’s property?
- Will you be in charge of the decedent’s final tax returns?
- Will you be responsible for preparing the estate’s final tax returns?
- What is the total cost of the probate process?
Can I sell a home without going through the Process?
No, a probate house cannot be sold until the Grant of Probate is gained. If the decedent was the sole owner of the property, they can list it on the MLS and even accept offers from a buyer.
If probate isn’t required, the owner can sell a house at any time. Probate is not necessary if the dead person left their estate in a:
- Joint tenancy Living trust
- Transfer-on-death agreement
- Handling Disagreements in Probate
Handling Probate Disputes
Estate settlement procedures are not always straightforward. You may have to address family disagreements. The most familiar probate disputes are listed below.
- When a will is unclear or contentious, disputes arise. To help solve these issues, you must prove the validity of the will in a probate court.
Estates with Multiple Applications
- In the absence of a will, the probate court is charged with deciding who will inherit the deceased’s property.
- Conflicts occur when multiple people request the same asset.
- This is a common problem for relatives or debtors who want to claim an asset. Appointing a probate attorney is the best way to handle these disagreements.
Challenging a Will
It is not uncommon for a person’s will to change. Disputes arise, however, if the deceased was pressured into composing or modifying a will. If you can prove such an assertion in court, the judge may declare the will null and void. Collaborating with an attorney at each step of the probate process can help you avoid such conflicts.
Mediation may be the most effective way to resolve probate disputes among family members.
Selling Your Probate Home
There are several steps involved in selling a probate house.
Request a Probate
Applying for a probate grant is the first step in selling a probate property. The grant could take two to twelve weeks to be approved. Before requesting probate, make sure you’ve registered the death and determined whether a will exists.
The property’s Value
Once you have the probate grant, you can proceed to determining the property’s value. Estate valuation differs by state, contingent on probate rules. An estate agent can assist you in accurately valuing the property.
A realtor will advise getting an appraisal to get the properties value!
Inheritance Tax Payment
Decedent’s estates worth $11.70 million or more are subject to a 40% federal estate tax.
- When selling an inherited property, there are numerous financial obligations that you must consider because you may not be aware of them beforehand. You may be liable for taxes on the funds raised of any inherited house sale. Although Texas does not have an inheritance tax, you will be subject to federal taxes based on the value of your home. The tax rate is determined by the value of the home.
- When you sell, you must report the money raised to the IRS because inherited home sales are considered taxable income. However, inherited properties are not eligible for a home sale tax exemption unless you first live in them for two years. So that’s a tax code benefit you’ll miss out on. The excellent thing is that you can use the stepped-up tax basis. This basically means you won’t have to pay capital gains tax on anything acquired before the previous owner died. You are only liable for the amount of time you have been the legal owner of the property.
- When you do sell, you must report the proceeds to the IRS because an inherited home sale is considered taxable income. The exact figure is determined by the fair market value of the property as well as any improvements you make to it. Even if no taxes are owed, you must still report it to the IRS or you may face problems in the future.
Notify the Appropriate Parties
It is best to inform other beneficiaries of the planned sale. You can also notify legal and financial organizations associated with the deceased person.
Getting the Property Ready for Sale
This step entails removing the owners possessions from a property.
Selling and Listing the Property
A probate grant is required to sell a property while it is in probate. If no disputes arise, the process of obtaining a Grant of Probate takes less than 14 weeks. After receiving the grant, you are free to list your property for sale and accept a contract.
If you want to find out if a property is in probate in Texas, you can go to the county courthouse and look up the property records.
If you want to negotiate with heirs during the probate process, you can talk to the executor or administrator of the estate. They will be able to tell you what the heirs are looking for and how to best approach them.
The tax implications of selling a property in probate will depend on the value of the property and the laws in your state. You should talk to an accountant or tax attorney to get specific advice.
The legal instrument granting the power to manage the estate, settle any debts, and distribute any leftover assets to the executor of a will.
The court will approve any sale of the property and issue a final order authorizing the sale.