Q: What is probate?
A: Probate means “proving the will” through a court proceeding. The probate court proceeding involves appointing a personal representative, determining the decedent’s assets, paying outstanding debts and disbursing funds to beneficiaries.
Q: What is the definition of a personal representative?
A: A personal representative is the person responsible for administering the decedent’s estate. A personal representative is either:
- An executor/executrix who is named in the will to “execute” the will; or
- An administrator/administratix who is appointed by the probate court when there is no will, when the will does not name an executor or when the named executor is unable or unwilling to serve.
Q: What are the personal representative’s duties?
A: A personal representative has a number of duties, depending on the complexity of the deceased person’s financial and family circumstances. As part of the winding down of the estate, duties may include:
- Reading of the will
- Identifying and collecting the estate’s assets
- Inventorying and appraising assets
- Paying bills and taxes
- Maintaining property until the estate is settled
- Distributing assets according to the will
Q: How long does it take to settle an estate?
A: If a formal probate court procedure is required, it may take from seven to nine months to complete all necessary steps, unless it is a complicated estate. The process can at times take one to two years if issues arise. View our probate timeline.
Q: What is the Independent Administration of Estates Act?
A: The IAEA are the laws which allow the personal representative to administer most aspects of the estate without court supervision. The personal representative can be either given administrative authority by the decedent’s will or by petitioning the court.
Q: What is the difference between “full” and “limited” authority?
A: A personal representative with “full” authority has the power to sell or exchange real property, grant an option to purchase real property, or borrow money with a loan secured by an encumbrance upon real property.
A personal representative with “limited” authority must obtain court supervision for the following actions: a) sale of real property; b) exchange of real property; c) grant of an option to purchase real property; and d) borrowing money with the loan secured by an encumbrance upon real property.
Q: Why do some probate sales not require court confirmation?
A: A personal representative, by petitioning the court, may be granted “full authority” to administer the estate under the Independent Administration of Estates Act. By doing this, the personal representative can avoid the need to obtain court approval for many actions taken in connection with the estate. With full authority, a personal representative may sell property without the need to obtain court approval. However, before taking certain actions the personal representative is required to give notice to all interested parties (unless they have waived notice or consented to the proposed action).
Q: What are some things that I should do to prepare the property for sale?
A: Some of the things to do prior to listing the property for sale can include taking inventory, removing belongings, packing and cleaning. An agent can provide you with a list of qualified specialists that will help you prepare the property for sale.
Q: Should I make repairs or sell property as is?
A: In most cases probate real estate is sold “as is.” While some properties are in pristine condition, others may need work. In some cases it may make sense to make certain repairs. An agent can help you determine whether repairs may be worth the money, time and effort involved.
Q: Can the personal representative enter into a contract with a real estate broker to sell the estate property?
A: Yes, the personal representative may enter into a written contract with a licensed real estate broker for the sale of real property for a period not to exceed 90 days. Prior court approval for each additional 90-day extension must be obtained, unless the personal representative has “full authority.”
Q: What is the minimum price at which real estate must be sold?
A: Without full authority under the IAEA, the minimum offer price for the sale of a property must be at least 90% of the appraised value of the property. The appraisal must have been conducted within one year prior to the date of the confirmation hearing.
Q: How can I determine what price I can list a probate property for?
A: A real estate agent can provide you with a comparative market analysis, which will help you determine a selling price for the property. This analysis takes into account similar properties that have sold in the neighborhood as well as other metrics that are factored into this analysis.
Q: How will the property be marketed for sale?
A: Your agent should create a strategic marketing plan in order to yield the most qualified buyers. Some strategies may include Internet and traditional print advertising, open houses, direct mail, and placing a sign on the property.
Q: What is the minimum amount required for overbid?
A: The overbid must exceed the original bid according to the following formula:
- The offer is for an amount at least 10% more on the first $10,000 of the original bid; and
- Five percent (5%) more on the amount of the original bid in excess of $10,000.
Original Offer: $100,000
Initial Overbid: $105,500.00 (10% of the first $10,000 = $1,000.00 plus 5% of the remaining balance of that bid of $90,000 = $4,500.00; $1,000.00 + $4,500.00 = $5,500.00. This amount is added to the original offer of $100,000.00. The resulting minimum overbid will be in the amount of $105,500.00.
Q: What does court confirmation of the sale of real property mean?
A: All sales of real property shall be reported to and confirmed by the court before title to the property passes to a purchaser. If the personal representative fails to file a petition for confirmation of the sale within 30 days after the sale, the purchaser of the property may file the report and petition the court for confirmation of the sale.
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