SELLING THE HOME OF A LOVED ONE
THE SELLER SIDE: Selling the Home of a Loved One
There may come an unfortunate situation where you find yourself having to dispose of a loved one’s property on their behalf. As the representative of the deceased you should consult with an estate attorney and the local government office to address the identification of the representative or administrator of the estate authorized to handle the deceased personal matters. I have had the privilege of supporting clients with matters such as these and have put together a few tips to help you navigate the process more smoothly.
- Establish and obtain documentation of legal administrator or representative of the estate. You must have the legal right to handle the estate on behalf of the deceased. If there is a will, then a pre-determined person or person(s) have likely been designated to inherit the property and specific processes will be required by the state to document the estate administrator(s). However, if the deceased, died intestate (without a will), then the court will determine who is eligible and who the administrator of the estate can be according to state law. Your estate attorney and/or the Clerk of the Circuit Court – Civil Division will be able to guide you.
- Don’t make any sudden moves. Sometimes the family is inclined to move the property into the name of an heir as quickly as possible in order to handle matters quickly. Before you take any action, it is highly recommended that you have a real estate attorney or title company run a title search on the property. Your real estate representative can also help you with the request and interpretation of the title results. The title report will identify the liens on the property so that you are fully aware of the current obligations binding the property.
- Conduct a financial assessment. Once the liens have been determined, do additional homework to build a list of any and all outstanding financial obligations including any HOA or condo assessment balances and monthly payments as well as other personal obligations. You will need to maintain the property until it is sold. The legal representative will let you know what is allowed to be paid off with any sales proceeds and how to handle any expenses that you might pay out of pocket on behalf of the estate.
- Don’t expect to receive proceeds right away. Probate law may require that any proceeds from the sale of the property be held in escrow for a specific period of time before the funds can be released to the estate or to the heir(s). It may be possible for a more immediate release if the financials, taxes and other estate documents have been properly filed with the county and the estate has been closed. Again, an estate attorney will guide you thru the probate process.
It is possible to dispose of a home of a loved one, even if it is a distressed sale. However, you want to avoid a transfer of ownership until you are certain of all of the obligations attached to the property. Unfortunately, if ownership is transferred prematurely, you may find yourself with unforeseen obligations that you have now assumed responsibility for. Once a property is transferred into your name, it cannot be transferred back into the name of the deceased. So do your homework in advance and enlist professionals to support you for a clean transition.
Lorrie Penn Hunter is an Associate Broker/Realtor and owner of The Dukes Group LLC at RE/MAX Gateway. She is licensed to provide real estate services in Virginia, Maryland, and DC. For general information or to sell or purchase a home, call 703.622.9046 or email LHunter@remax.net.