If you are a real estate investor, if you are yet to, chances are you will soon run into a probate real estate sale. Buying a property in probate court could prove a bold move as the prices are often lower. However, there is a catch probate sales can take longer than standard real estate sales.
Subsequently, most buyers often hold back on probate real estate sales. Also, most agents advise their clients against getting excited about their chances of buying a home in probate court.
To stay on top of things during the probate process, hire The CREM Group for smooth probate real estate sales in Los Angeles and Orange County. We offer you licensed real estate brokers, who are also attorneys to assist you through the whole process.
Here is what you need to know about probate real estate sales.
When is a Home Sold in Probate Court
A house will often be put up for sale, as a probate sale, when the homeowner dies without having created a trust during their lifetime.
Some probate sales require court confirmation. The probate court is there to oversee the process. The court wants to ensure the property is marketed and bought for the highest possible price. To guarantee this happens, the Court requires the following of set down measures, actions, and procedures.
Probate laws differ in various states; however, any real estate agent worth hiring should understand the twists and turns involved in probate real estate sales. The CREM Group offers some of the best probate realtors in Los Angeles and Orange County.
Probate Real Estate Marketing
The marketing process of probate real estate is the same as any other property on sale. The probate lawyer or the estate’s legal representative will interview qualified real estate agents and pick one they are confident in their skillset. Choosing the best from the bunch is vital as a mistake in the probate process could prove costly.
The next step is determining the listing price and signing the listing agreement. The listing agent or an independent probate referee chosen by the Court will then recommend the listing price. Note that the final selling price must be inside 90% of the appraisal value set by the probate referee.
When marketing the property, the agent must put out a “Notice of Sale” a minimum of three times at least ten days ahead of the sale. The third notice should come five days following the first one. What follows is putting the property out there for viewing.
Submitting an Offer
An interested party can submit an offer on the property whenever they are ready. Note: when making an offer on a probate real estate sale, it typically requires a 10% earnest money deposit. The estate’s representative will then counter or accept the offer.
The offer depends on confirmation from the courts. Despite the seller accepting the buyer’s proposal, the agreement is final until confirmed by the court. Within thirty days of approving the bid, the probate attorney has to petition the Court for confirmation. The Court will then settle on a date for court confirmation hearing.
Before the date set by the courts for confirmation of sale, the estate’s representative must inform specific parties with interest in the sale.
Waiting it Out
Once the Court sets a date for sale confirmation, there is a period of between 30 to 45 days which the parties have to wait out. Over that period, the Court will demand renewed advertisement and marketing push with the new approved price. For instance, in California, the Court will raise the accepted price by appx. 5%. The sum of which becomes the minimum overbid amount for overbidders who may want to come and bid on the property at court.
At the probate real estate sale confirmation hearing, the Court invites all potential buyers and other concerned parties. They will then commence the selling of the property auction style. If you are in California, the opening bid will be appx. 5% higher than the contract price.
On occasion, overbidders will show up at court to bid. However, if no one shows up for the bidding, the buyer with the first accepted offer is sold the property for the initial price offer they made.
Roughly a week after the court confirmation hearing, the Court will place an order verifying the sale, and then escrow can close the probate real estate process.
Crem Group Probate Real Estate
Call The CREM Group to get the best probate real estate services in Los Angeles and Orange County.