Can I sell real estate during probate?
Is it advantageous to sell real estate while in the probate process, as opposed to selling it after probate is closed—or at some other time?
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As long as the property is sold within a year after inheriting it, it doesn’t really make much difference from a tax perspective since the proceeds are typically tax-free. However, if you have a buyer now who’s willing to pay far above the actual value, it’s often easier to divide the cash proceeds in the estate rather than put multiple heirs on the deed and later coordinate a sale.
As for the judge, they won’t object to the property being sold for more than it’s worth. Issues usually arise only when a property is sold for less than fair market value, especially if it appears to benefit the executor or someone close to them.
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Is it advantageous to sell real estate while in the probate process?
Lexi, Chatbot
I understand you’re considering selling real estate during the probate process. Have you already started the probate process for the estate?
Yes, I have.
Lexi, Chatbot
Are there any specific concerns or challenges you’re facing in relation to selling the real estate while going through probate?
My father passed without a will, so we would need the court’s approval to sell it. The home is being sold for much more than it is worth. Would a judge object to a home being sold for much higher than the fair market value?
Lexi, Chatbot
Is there anything else the lawyer should know before I connect you?
Yes.
Barrister
Hello and welcome to the site! My name is Barrister, and I’m a licensed attorney here to help. I know your question is important, and I’ll do my best to give you a clear answer.
Is it advantageous to sell real estate while in the probate process, as opposed to selling it after probate is closed—or at some other time?
Barrister
As long as the property is sold within a year after inheriting it, it doesn’t really make much difference from a tax perspective since the proceeds are typically tax-free. However, if you have a buyer now who’s willing to pay far above the actual value, it’s often easier to divide the cash proceeds in the estate rather than put multiple heirs on the deed and later coordinate a sale.
As for the judge, they won’t object to the property being sold for more than it’s worth. Issues usually arise only when a property is sold for less than fair market value, especially if it appears to benefit the executor or someone close to them.
Thank you, that’s what we were hoping. I have one more question—when completing the inventory and appraisal for the estate, should I list the home’s value based on the county tax assessor’s value, fair market value, or the contract purchase offer?
Barrister
If you already have a purchase offer—though it might be premature without court approval—you can list that as the value. Otherwise, fair market value or an independent appraisal is the best indicator. The county’s assessed value is usually too low to be accurate for probate purposes.
I also wonder if I’m in over my head and should hire an attorney. I completed what I believe is called a formal petition to sell. My brother is waiving his right to a trial and agrees to the sale. Would I be required to appear before a judge? We don’t have permission to sign the contract yet. My father had actually been negotiating the sale about a week before his passing. The contract is drafted and just waiting for the court’s approval.
Barrister
Typically, yes—you’ll need to attend a hearing so the judge can review your motion and approve the sale. Sometimes judges sign off without a hearing, but more often they want to see you briefly and confirm the sale price and terms are in the estate’s best interest.
Do you recommend hiring an attorney? The documents say one isn’t required, just recommended.
Barrister
If the estate is simple and there’s no dispute among heirs, you probably don’t need to incur the expense of hiring an attorney. You can handle most of the paperwork yourself.
Thank you—you’ve helped me with all of my questions.
Barrister
You’re very welcome! It was my pleasure to assist. Have a good evening and stay safe!
Barrister
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