What is probate in real estate? If you’re dealing with a probate property in Fort Worth, you’re likely to have a lot of questions. We’ve included some information regarding probate properties, as well as how to deal with them in this article.
What is Probate in Real Estate
Probate is the legal process after a homeowner’s death if the property is not in a trust or owned by another person without full survivorship rights. In most circumstances, real estate that needs to go through probate will need to be sold so that the proceeds can be divided among the beneficiaries if the will does not specify who should receive the assets.
The first step is to figure out where the probate will take place. Many states require to complete the probate in the county where the property is located. After that, you’ll need to hire a lawyer to review the will and draft the papers. After that, the lawyer will take the paperwork to the courts. The judge determines who is the rightful owner of a piece or portfolio of real estate, usually based on the previous owner’s will. Rarely does a judge overrule a person’s Will?
Who Pays For Probate?
The executor of the estate will set the property’s listing price, negotiate the sale price, and finalize the sale contract. After that, the lawyer handling your probate will send an invoice to the title business handling your real estate sale. The probate’s cost is deducted from the proceeds of the property sale. The cost of their services might range from a few hundred dollars to well over a thousand dollars. This varies depending on the state and the property’s worth.
Do You Need To Pay The Executor?
The Texas Estates Code requires five percent (5%) on all monies received or paid by an executor or administrator of an estate (the Texas two-step on executor compensation). The law in Texas prohibits an executor or administrator from receiving a fee for managing the assets of a deceased person. Cash in hand, including checking and savings accounts, as well as uncashed cheques, life insurance policies (unless difficult to obtain), and cash bequests, are all off-limits. If the work is extremely difficult, the executor may be able to earn a commission of more than 5%.
Can I List Probate In Real Estate?
You can’t sell or even list the property until the probate is over or the court approves. To list the property, you will need to file a court petition. When you list the property available for sale, you may make offers on the property and have a contract; however, the closing will not occur until the probate is complete. Once the executor files the probate case, the title firm will know who can legally sell the property. In an earlier post, we talk about probate property and how to deal with it which you may find helpful as well.
How Much Should I Sell For?
You must get the property appraised in order to know how much it is worth and if there are any structural issues that must be reported on the contract for sale in order to know how much you can ask for the real estate. When you receive offers, you must factor in the cost of probate. If you possess an empty lot, double-check that the offer is sufficient to pay your costs. The majority of homes and other types of real estate will sell for much more than the cost of the probate. If you want to sell probate real estate quickly, you should advertise it at the bottom end of the market comps or assessment price range. This will ensure that you get bids soon.
How Long Does A Probate Take?
You cannot expect probates in real estate in Texas to complete in a matter of weeks. A will can be probated as a muniment of title if there even is one. Even this shortened type of probate will take two to three months to complete. When there is no will, the same applies to a minor estate affidavit. If there were such a thing as typical probate, it would take at least eight months in Texas. The probate process usually takes at least a year.
I’ve Accepted An Offer, Now What?
Execute the contract once you’ve gotten an acceptable offer or negotiated a price you’re willing to sell for. If you have any questions concerning the contract, contact a real estate lawyer for assistance in understanding all of the terms, conditions, and riders that must be met in order to finalize the transaction. When you’ve decided on a title company, make sure you provide them with the probate lawyer’s invoice so they may pay the bill with your proceeds.
Check out one of our earlier blogs to learn more about the probate process when you inherited a house in TX.
Probate in Real Estate Summary
Dealing with probate in real estate is exhausting, emotionally and mentally. Most people don’t want to go through the stress and opt to sell the probate property instead.
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