Sale of Real Estate Properties During Probate, and How to Avoid It
If you think that disputes over inheritance money can lead to long-standing grudges among siblings, or between your children and your stepparent, imagine how much worse those disputes can be when the inherited property at stake is a house or other piece of real estate property instead of just money. It is easy to divide money, even if one or more heirs feel that the amount they have received is unfairly small. It is impossible to divide a house without selling it, and if some heirs want to keep the house but others do not, the heirs can easily find themselves at an impasse. As with so many estate-related issues, prevention is the best cure. An estate planning lawyer can help you plan for what to do with real estate properties that become part of your estate.
The Pitfalls of Probate Sales
Selling a house is a lot of work, but selling a house that legally belongs to the estate of a deceased person is even more work. To sell a house that is in probate, the personal representative must meet a list of requirements, including getting the court’s approval to sell the house for a lower price than its appraised value if you cannot find buyers who will pay your original asking price. You must also obtain the written consent of all the beneficiaries affected by the sale of the house. If the appraised value of the house is more than $600,000, then there are even more steps to assessing its value.
If some heirs want to sell the house, but others want to keep it, things are equally complicated. One heir can buy out the others, but that costs a lot, so not every heir who wants to keep a house that goes through probate will be able to. If the house sells when the heirs, despite having given their consent so as to avoid prolonging the probate process, are not completely comfortable with the sale, they will feel like their siblings cheated them financially, or worse, deprived them of their ancestral home.
What to Do Instead of Letting Your House Go to a Probate Sale
The best ways to avoid the expenses and hard feelings associated with the sale of a house in probate is to keep your real estate properties from going to probate in the first place. One way to accomplish this is by transferring them to a trust; this way, they will belong to the trust instead of to your estate. The other solutions involve getting the house out of your possession while you are alive. You can transfer the title of the house to one of your children while giving the others an amount of money equal to what they would get if their sibling bought them out of the inherited house.
Contact an Attorney Today for Help
An elder law attorney can help you resolve disputes between your heirs over real estate properties and other assets that you wish them to inherit. Contact Clearwater estate planning attorney William Rambaum to discuss your questions.