Whether it’s for the purposes of moving on, dealing with grief, settling a debt they left behind or any personal reason you have, selling out your parents’ house after their death is a daunting prospect. It’s one of the saddest yet emotional decision you’ll have to make after their death. As if that is not enough, there’s the legal side of things—the paperwork and other financial issues that need your attention.
All these can be stressful to combat at once. And as a result, you might fall victim to preying real estate agents who want to profit from your desperation. Luckily enough, here is a piece on everything you need to know and watch out for when liquidating your parent’s house. Further, this guide also highlights the dos and don’ts of selling your childhood home and why it isn’t easy.
Selling a house after death of parent
The legal side of things
Most individuals expect the house of their parents to be passed down to them as an inheritance. However, only a small percentage of these individuals understand how the property will pass down to them. Selling your parents’ house will need you to understand how the property was passed down to you. Additionally, you’ll need which means used by your parent by them to pass it down to you. This could be one of three things: probate, transfer via living trust, or a death deed.
The Probate process
Most families fall victim to the illusion that transferring property to your name is as simple as your family lawyer reading out a will to you. That might work in the theatres, yes but not in real life. Real estate inheritance made via a will is subject to a long and almost endless probate process. And if there is no written will, and there are numerous claims, a probate procedure is definitely certain.
Having said that, what is probate?
Well, probate is a legal procedure that oversees the dispensation of your parents’ assets. This procedure is done to determine whether the will they left behind is valid or not. The procedure ensures your parent’s debt is settled and something left behind to the heirs.
After a parent’s death, the court appoints an internal agent of theirs or verifies an executor mostly named by the will to oversee the process. He or she administers the probate process. His role is to collect assets left behind by the deceased, settle the deceased’s debt, and finally redistribute what’s left to the beneficiaries.
Is there a will
Most individuals who prepare for their death or play it safe leave behind a written will. They are known as a testator. The will stays in the hands of the executor until they die. Upon death, the executor initiates the probate process. Generally, they are a financial advisor trusted by the deceased to execute their last wishes. A will left behind by the deceased provides the executor and what he should do with the deceased’s assets.
Upon death, the executor starts by applying for probate. In turn, this initiates a series of events such as verifying, authenticating and acknowledging the will as the true last statement.
Also, the court granting the executor legal power to proceed/act on behalf of the deceased. These events might look simple to execute, but they are not. They’ll take time to implement.
The role of the executor and how they oversee the probate process.
As stated earlier, a valid will typically name the representative of the deceased. Basically, this representative will get the nod to locate and oversee the assets of the deceased. This explanation might look shallow for most individuals. And as such, here is an in-depth look at his responsibilities.
Once approved by the court, the executor evaluates the estates of the deceased. Afterwards, he subjects them to each asset to the probate court except for real estates. In the case where the deceased had pending debts or taxes, the executor pays them off.
Claims are only considered valid within the first year of the death. Claims made after one year are deemed invalid in some countries, while others can be taken to court. Note: If the deceased debts outweigh their assets, the administrator will not initiate probate.
Once everything is paid off/sorted, the executor will seek authorization to distribute what’s left to the beneficiaries.
What if there’s no will for the probate to work?
Most individuals die without leaving a will behind. As such, the deceased leaves behind property, yet there’s no one to claim or a specific heir to inherit the will. In other cases, the court can deem the will presented to the as invalid. In such a case, the property left behind is classified as an intestate estate. When this happens, the court lacks a blueprint to redistribute the assets of the deceased.
For such scenarios, the court appoints an administrator who’ll serve as executor. He or she will oversee the estates left behind, receive any legal claims against the said property, and pay off any debts. Once the administrator has sorted out such claims, he’ll locate any heirs left behind. Once located, he’ll present them to the court. Afterwards, the court will assess the remaining property and equally distribute it to the children.
Key takeaways from a probate
- It’s a legal way of reviewing the assets left behind by a deceased person to determine the rightful beneficiaries.
- Probate proceedings use a will as its primary blueprint to determine the right inheritors.
- Probate proceedings are mostly effective for cases where the deceased has left behind high-value assets.
- Each country has a way of handling its probate proceedings.
Transfer via the death deed/beneficiary deed.
Another way to transfer property from your parent down to you is through a death deed. A death as simple as the movies, and it lets you inherit the property directly without the hustle of probate. With this transfer, one can easily sell their parents’ home minus having to worry about legal issues. Sadly, this form of transfer is only limited to certain states and countries as well.
Some countries will require a death deed for you to inherit your parent’s home. On the other hand, other countries will demand the death deed and a written will for this form of inheritance to be acknowledged as valid. All in all, this method of inheritance is as simple as the ABC. Though, you’ll still need to sort out the inheritance tax on the house before selling it.
Inheritance via a living trust
Of all the three methods of property transfer, inheritance via a living trust is the easiest. Inheritance via a living trust is a form of passing down assets where the parent entrusts the property to a trusty. Here the deceased signs a legal inheritance document that passes off the assets to the trusty.
If the parent passes on, the assets are transferred to the trusty who passes it down to the children. The document names the trusty and allows them to manage the assets before they are passed down to the kids.
This form of inheritance bypasses everything negative about the first two means of inheritance. For starts, it allows you to inherit property minus probate. Second, this inheritance measure bypasses the taxes impounded by the death deed. As such, it allows you to sell the house immediately.
Inheritance via a living trust is most suitable for parents with multiple heirs. If the deceased set up a trusty, they decide which heirs should decide on the sale of the house.
Selling a house with the help of an agent vs selling it on your own.
With the legal issues out of the way, the next step would be selling out the house. For this, you’ll need to hire an agent specialized in such sales. The idea of selling a house on your own minus an agent might sound attractive, but it’s not. If you put two and two together and compare the two, you’ll settle for an agent without question. Selling a house on your own will save you the agent fees and subject you to endless disadvantages.
For starts, you’ll have to deal with inheritance disputes, find a buyer as well as finance papers used in the sale. Additionally, you might end up getting a terrible deal that isn’t worth the house. On top of that, finding a buyer can be a pain in the neck. And if you finally land one, they might not be genuine and, as such, scum you off your property without breaking a sweat.
On the other hand, if you land an experienced agent, you are guaranteed a whole lot more than a good deal. For instance, you are guaranteed safety and less time in court walking with legal papers. Also, you are safe from the hustle of landing a decent client.
Most agents have a wide connection between sellers and buyers. As a result, your property will land the best buyer within a few weeks. As if that is not enough reason to change your mind, agents have good bargaining power. This means that they’ll easily convince your buyer and get you a better evaluation of the property.
The dos and don’ts of selling a house after death of parent
Don’t be rational with the sale or when making the sale. Think twice and counter check everything before selling. You don’t want to deal with endless law suites after transacting.
Be patient. Court proceedings can take months before they are finalised. So with that in mind, be patient with the proceedings, the executor and your sales agent. They are fighting for your right and working on landing you the best deals.
Always ask around from people who’ve had a similar experience. You never know you might land the best advice to help you with your sale. So with that in mind, consult your friends for advice. And look at how they handled the matter and how they’ve handled the matter.
Don’t be ashamed of selling. It’s normal to sell your parents’ house after their death, people do it, and people have done it before. Yes, it’s their life’s investment, but change is good for moving on past your grief.
Always do your research. The best way of getting information is through reading, going through countless journals, articles and even books. Having said that, do some digging into the topic at hand. Go through your agent’s profile as well as the executor’s profile. On the same note, do some reading on the above means of inheritance and your country’s application. You never know what you’ll find. It’s better to be cautious than sorry.
Don’t be too attached. Let go of the property and the memories that connect you to it.